Don't listen to me...listen to the national housing experts! NOW is the time to BUY a home.

I really wish I would have known who John R. Talbott was in 2007 when I purchased my last home (prior to being a licensed agent); at this time, I was one of the millions of people who had buried their head in the sand and didn't even think about the housing bubble and how it would eventually burst. I wish I would have read his book Sell Now! The End of the Housing Bubble, which came out only months before my husband and I purchased our home (which is now worth $30,000 less than we paid). 

Mr. Talbott recently wrote an article "Homes - Buy Now"; his opening paragraph is simple and to the point, "I have been waiting for more than five years to offer this advice. It is now time in most cities across the country to buy a new home or refinance your existing home with thirty-year fixed rate mortgage debt". He goes on to state several reasons to support this claim but the one that stuck out to me is the fact that according to the S&P Case Shiller price index, residential real estate values are equal to 2003 first quarter prices. Wow! Now factor in the current mortgage rates and it becomes very clear why buying a home today makes perfect sense. 

Here is a sample to stew over (taken from www.keepingcurrentmatters.com):

This equated to a $285.30 a month savings, $3,423.60 a year and $102,708 over the life of a 30 year mortgage! 

A recent report by JP Morgan explains another great reason why now is a great time to buy a home.  One measure of housing values is the ratio of personal income to home prices.  The report explains where we are today:

"Since 1966, the median price of an existing single family home in the U.S. has varied between 150% and 251% of personal income per household.  However, roughly three quarters of the time it has been in a relatively narrow band between 185% and 230%".

Today the ratio is just 153% implying that to get back to an average price to income ratio, home prices would have to rise by about 27%. 

Mr. Talbott closes his article with the following: "So, run, do not walk to your neighborhood banker and either finance a new home purchase or take out the maximum amount of money he or she will lend you on a home equity loan and buy hard assets, not financial securities, with the money. When inflation comes roaring back the only perfect hedge is to be a borrower, not a lender or investor. Shakespeare said "Neither a borrower nor a lender be," but they didn't have huge government deficits and the risk of future inflation back in the Bard's time."