Why is now a good time to buy real estate?  Although we are in the midst of a recession and there seems to be bad news 24/7 on the cable networks, for many buyers this has been one of the best times to buy in recent memory.  Most of my buyers at this time are first time home buyers and investors.  First time home buyers have many factors pushing them into the market at this time, with home values at their lowest in years, historically low interest rates, and the $8000 tax credit, there is real incentive at this time.  Their money goes farther with the low purchase prices and interest rates at a 40 year low, many are looking at this being the right time to stop paying rent, and moving into a home that they can ride this economy out with a good property for the next 5-10 years. 

 

Investors are scooping up bank owned properties for sometimes ½ of the neighboring comps, to fix and flip, or to create a good rental property, again with the goal of selling years down the road.  Many investors feel there are tremendous opportunities at this time, although when they actually get into the market, they find that they are in great competition with fellow investors.  Many of these bank owned properties are receiving multiple offers within hours of hitting the market and selling for substantially over list.   Last week I encountered a bank owned, 4 bedroom home for $168,000, in an area where I know the comps to be $250,000 and up.  Within a few hours I was touring the property, 5 different real estate agents were there during my 20 minute tour, and I was informed by the listing broker there were already 5 offers submitted.  The property was listed at 9am, this was noontime the same day.  I will be very curious to see what it ultimately closes at.  Why tell this story?  There are great opportunities, but be prepared for great competition.  Know the market, have your finances in order, and be prepared to act quickly.

 

All in all, this is an exciting time to be a buyer in the real estate market.  With the tax credit set to expire November 30th, it will be interesting to see if it is extended, and how that impacts buyer’s motivation.