Is it still a good time to buy?

Is it still a good time to buy? In my opinion the answer is yes. I understand that the media has been overwhelming buyers with the negativity of the subprime market and the fact that the rates are going up. Yes rates are going up slightly and lenders guidelines have been getting tighter for those clients with less than perfect credit. But if you can truly afford the payments I say go for it. The costs of homes are going down, at a much faster pace than the rates going up. Does it matter that rates are going up? No it doesn't. Rates are still considerable low compared to its historical trends. I think buyers need to capitalize on the fact that it's a buyers market and you can save thousands of dollars on your home. Now if buyers decide to wait until the market gets better then home prices are going to go back up. Now granted no one really knows if the market as reached it's low and won't go any lower, but we can make a safe bet that it won't. With all the media attention and congressional hearings on the housing market, changes will be made soon. So why not go for the sure thing and buy that house when the price is low. Remember you can always refinance your house if the rates go lower, but you won't be able to save on those thousands of dollars if the home prices increase. We have to look at the housing market like we look at the stock market, buy low sell high. Prices on homes are very low. Take advantage of that.

Let's do some math here to show you what I mean. Let's say the price of a home you are going to buy right now is 200K. A 200K loan on a 30yr fixed loan with an 8% interest rate, your mortgage payment (not including taxes and insurance) will be $1,467.53. Now if you wait and the prices of homes increase that same home is going to cost you 250K. A 250K loan on a 30yr fixed with a 7% interest rate your payments are going to be $1,663.26 (not including taxes and insurance).  So as you can see it is really the price of the home that drives your payment up or down, not so much the interest rates. Also keep in mind rates usually gradually go up or down, you won't see rates jump or decline by 2% over night. But you will see the prices of home increase or decrease by thousands and thousands of dollars. Like I said before if rates do go down in the future you can always refinance to that lower rate, but you can never turn back time and purchase that home with the savings that you are getting in today's' market.