I'm sure you've heard this before: When there is a lot of inventory it is, generally speaking, a good time to buy a home. As a buyer, you have more choices. Sellers know there is a lot of competition, and therefore are more likely to price their homes competitively or to offer other incentives, such as closing cost assistance or a flexible closing date.
As a buyer, you are probably confused. You are hearing and reading conflicting reports. Many of you are wondering if you should wait a few months to see if prices go down. Others are afraid that if you don't buy now, you will miss your chance to get the best price, or interest rates will go up which will affect how much you can afford.
Let me make one thing clear: The "right" time to buy a home is when you:
a) Have your financing in order; and
b) Find the home you love at a price you can afford and are willing to pay
Market conditions can change relatively quickly. Without the benefit of a crystal ball, no one can predict what will happen over the next few months. Keep in mind that media reports are based on national statistics, and in reality, only what is happening locally is important. Do some research and have your Realtor show you local market statistics and trends. Ask your real estate agent to show you recent comparable sales for the home you are considering buying. Only then can you make an educated decision about whether you should buy now, or wait until later.
A good source of information on housing market trends is Data Quick. Below is a snapshot of the market in Lake County, Illinois, taken from the DQ website at www.dataquick.com. You can find information on most major market areas by selecting "DQNews.com: Real Estate News" and looking up your local market area.
As you can see, in some areas the median home price has gone down, and in some areas it has gone up. In Lake Zurich, Illinois, the median price of homes has increased 3.5% from the same time last year. This can be interpreted in a number of ways, depending upon who you talk to. Indeed, it depends upon whether you are talking to a "glass half full" or "glass half empty" person. Some might say that you should buy now in Lake Zurich, because prices may continue to rise and you could end up priced out of the market. Others may say the opposite: that home prices haven't come down yet so you should wait until they do.
So, what should you do?
Let me repeat: The "right" time to buy a home is when you:
a) Have your financing in order; and
b) Find the home you love at a price you can afford and are willing to pay
Avoid trying to time the market. The only thing right now that I can say with absolute certainty is that there are more homes on the market right now than in recent years (at least in my market area). This means that as a buyer, you have more choices. And choice is good.
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