Has Real Estate Bottomed?

Has Real Estate Finally Hit the Bottom?       The REAL question is "Should you really care?".

Sellers - Sellers need to decide if it makes a difference to them, if they have another choice, If it is better to hang on until maybe the 2nd quarter of 20??. Divorce, job transfer, retirement, and a host of other reasons could have sellers deciding it makes no difference as outside circumstances can have sellers feeling they have no choice or it makes no difference. They simply decided to sell. Many believe it will be better to 'hang on' until prices rise. Under some circumstances they could be making the best decision for themselves. IF they have time, probably a lot of time, prices could rise enough to make them happy all the while having a home to live in. This group makes the most sense if they are not going to buy another home or are moving to a location where home prices are lower. Waiting for prices to move up 20% in order to move up to a more expensive home is questionable. Waiting for a $200,000 home to rise 20% would add $40,000 to a sale price. If moving up to a $300,000 home that same 20% adds $60,000 causing a $20,000 loss over selling now.

Buyers - Buyers can gamble renting a while longer will be beneficial. Those only need to be concerned prices or interest rates rise quickly while lease locked. The non-gamblers can only see low prices with the added bonus of low interest rates. If they are looking for a home they are going to stay in for an extended time the main focus is being in the home they want. If during that time prices drop it is of no concern as they will probably rise long before they are ready to move. In the mean time they have a home, are building equity, and are receiving tax benefits. The worst possibility is waiting until both ptices and interest rates rise - a double whammy.

No one knows - No one really knows when prices will rise or if they have bottomed. It sure looks like they are close if not bottomed. Prices could also begin to rise soon but it has been written often the rise will come in time and OVER A LONG Time. Interest rates may easily begin to rise 1st. Housing cycles and only investors should look at real estate as an investment, especially a short term investment. It is being said now is a great time to be a buyer. Does anyone disagree?