Some ideas die hard.  I ran into the former boyfriend of a friend's daughter the other night in the Sam's store and he mentioned that he was thinking about wanting to buy a home.  In talking to him a bit more it came up that he was under the impression that he had to have 20% to put down on a home in order to buy a home.

This young man has good credit, a solid work history and has been putting 30% of his after tax paycheck aside in order to buy and he was surprised when I told him that I could get him into a home now, if he so desired.  This made me wonder, how many other antiquated "facts" and assumptions are still floating around out there?

While I would never discourage someone from saving money for a down payment, I would at least want them to know what their options were if they decided to buy now rather than later.  The other thing that I pointed out to him was that NOW is a great time to buy a house.  Inventories are up, showings are down and interest rates are still relatively  low.  This all adds up to it being a buyer's market in St. Louis!

He expressed concern about whether or not the recent market downturn was over or not and I told him that there really was no way of telling.  I also told him that, in my personal opinion, that at least here in the St. Louis real estate market, that I didn't think that prices would continue to tumble. 

The St. Louis real estate market never experienced the wild appreciation that some other markets did, so I didn't think that we had as far to fall either.  One other consideration is that it really does cost "X" dollars per square foot to build a new house and while prices may fall below that figure for a while, that the builders would not continue to build houses if they couldn't make a profit.  The same would hold true for existing home sellers who weren't in a position where they "had" to sell.  I told him that I personally had removed a property from the market because I wasn't getting any interest at what I thought was a good price.

The end result of all of this was that I didn't think that prices would continue to fall in the St. Louis real estate market for very long and that now with so few buyer's out there, that now was a good time to buy a home in St. Louis.  I don't know if he's going to want to make the jump right now, but I hope that he does because otherwise he'll just continue to collect rent receipts!

Bob Mitchell

ValueList Real Estate Services, Inc.