Ernie, I feel if a buyer has good credit, now is the time to jump!  Nice post!

Joyce, your right about that.  The interest rates are low and they have lot's of choices.  They can negotiate a great price too.  Thanks for your comments.

Ernie I hope  Buyers don't wait to the pool is empty and the pool party is over. It is a great time for Buyers to come out of hiding and begin strategic planning (at least here in areas of Solano County).

Dionne, Solano County is not too far from Sacramento County.  It is just a hop skip and a jump away.  I agree with you that buyers should not miss out on these great deals.  I do believe that strategic planning would be advised to make sure they get the best information and advice possible.  I wish you much success there!

Hey Tom, it is always good to hear from you!  I hope we get there soon, too!  :)

How is the real estate market in your neck of the woods?

I'm scared we aren't there yet...and have a ways to go. Time will tell. Have a good day.

It is like stocks (we all learned that one) who can call the bottom? No way. If your situation says buy then it is time...

Merry Christmas!

Ernie - I say to all buyers---    Yes, now is the time to buy. As buyers we have been wanting lots of inventory, great rates and a buyers market....we have all those!! I say jump in!

Sam, I "feel you" it is scary.  Where is Texas in the real estate cycle?

Charles, you are right it is like the stock market.  You can not tell what is going to happen, with the exception that the market moves way slower, so you can move in and out a "little" easier and time it a little bit" better.  Thanks for commenting!  Merry Christmas to you too!

Candace, great point!  I will take note of that and use "lots of inventory, great rates, and buyer's market" in my marketing.  Thanks for that! 

I am hoping for an after the holidays market:)  Spring market is always good, so, we are getting close!

Hi, Ernie

We're about 18 months into our 'down' cycle.  Personally I don't think we're anywhere near the bottom yet.  Homes are languishing on the market, prices are still dropping, and Notice of Default filings are way up.  Where oh where is my crystal ball? :)  Jesse

Ernie - great post.    I think your point about the market being localized is the message here.  As you say, "One size does NOT fit all"    Surely we have some more fallout ahead of us and some markets are going to (and already have) rebound quicker than others (the damn media doesn't help)  But I think the worst is over.   We are certailnly closer to the end than the beginning.

If one is looking for a piece of investment property at rock bottom prices to flip in 30 days, this is probably not the market for them.   But if you are looking for a home for your family, primary or second (I am in a huge second home market) then I think buyers need to look more to the long term.   Their expectations that they should be able to double their investment in a year or two is not going to happen.  We are simply returning to a more normal market.   It's our job to educate and set realistic expectations and help our clients look at their motivation for buying beyond the unrealistic appreciation.   It's about the yard, the neighborhood, the school system, the ocean views etc.

As others have noted here, interest rates are LOW and offset that $10,000 differential they seem to clutch to.   Many are going to miss their opportunity and kick themselves later.  

Ernie, hard to tell when the bottom will be. In our area we have been a buyers market for so long with very slight appreciation, we're just seeing a slowdown in sales. I think if a bottom in our area is approaching it will be Feb-Mar 2008. The national media keeps saying 2 million more homes will have interest rates adusting on them in 2008 so that could be a big effect on the answer too. Some markets like Fla and California may have a bottom into mid year 2008 (or beyond?) to start working down the inventory.

Greetings Ernie,

We are knocking on wood up here in the Portland, OR market. It seems to be one of the few still getting favorable press because it is still experiencing some appreciation. Using the average sale prices for the twelve months that ended in October 2007 compared to the twelve ending in October 2006, appreciation is at 6.7%. Average market time, however, has increased to 64 days. At October's rate of sales, the 15,567 active listings in the Portland Metro Area would last about 8.4 months. If we found the bottom, it isn't too bad.

Most of  us realize that it is always a good time to buy, as long as we don't have to sell.  That is to say, in the long term, real estate makes money, increases net worth, borrowing power, and a host of other goodies.

To answer your question, however, I have not yet brought out the pole to go bottom fishing.

Cheers,

Frances, yes, there is that yearly cycle and there us usually a small surge right after Christmas and the New Year.  It starts to lag again and then picks right up after tax time.  The unfortunate thing for us in the Sacramento region in California is that there was not much of a pick-up the last two years.  I am really hoping to see a pick-up this new year!  We really need it.  I don't need prices to go up, we just need transactions!

Jesse, I hope your wrong, but most likely you are correct.  There will be more defaults this spring because of interest rate adjustments.  But, maybe, just maybe, the Feds cutting rates some more will soften the blow and reduce the number of foreclosures so we don't flood the market with more properties and therefore devalue the prices.  Thanks for your update on your area!

Ernie,

"Are we there yet?" If you provide me the lotto # for tihs weekend drawing, I can give you my predictions! Just kidding....unless you know it then we can still talk.

On a serious note, it is difficult to tell where the bottom is. However, I think this is an excellent time to buy as the interest rates are still fairly low and there are many great homes to choose from. With the tightening of the credit market, those waiting out may eventually end up missing the boat ... again!

Dave

Dave, you are too funny!  I wish I had the numbers!!!

I am with you on how the market is great for buyers!  I personally think we are very near the bottom of our real estate cycle here in the Sacramento region.  The San Francisco Bay Area is already on the upside.  They have a 8-9% appreciation rate as we speak!

I just got news today that the guidelines for FanieMae loans have just got stricter on 100% programs in declining markets.  I am not sure how that will effect the current real estate market in the Sacramento Region.  When it rains it pours!

Ernie to your point, there was an extensive article in the Wall Street Journal that speaks to this and more.... I have posted a blog referencing this with the link.   You may want to take a look as this affects all of us in this industry.   NOW IS A GREAT TIME TO BUY as it may start to get expensive down the road.  Being the eternal optomist that I am, I will keep my energies to the pursuit of growth and revival.....

Linda, I will go checkout your blog with the link and read it.  I am always looking for good articles like that.  I am an optimist myself.  I have been told that it is one of my biggest weakness, but I think it is one of my best strengths!  Let's go for the gold!  I am getting so busy right now, it is getting harder to get on-line.  It is a good problem to have.  :o)

No way have we hit bottom, i live in NY and know some hedge fund guys, no way maybe mid summer from what they tell me.

Ernie,

Real estate markets are very local, even within a city. The consumer reading national media gets the picture that the whole country is in the weeds and it isn't so. The coin has two sides, the buyer's side and the seller's side. Now it happens to be the buyer's time. Great opportunities in select locations.

In Florida, I think we are at or close to the bottom.  Inventories in most areas have plateaued for several months now.  Interest rates are very low. The only relief will still need is from high property taxes and insurance.  Some tax reform may occur if our tax relief amendment passes in January.  That may the thing that finally bottoms Florida out.

E Jeffrey, thanks for commenting and sharing your thoughts.  I just saw the Donald Trump on a show talk about New York being very hot right now.  I know markets are all different, but in general terms, many people are saying we should be near bottom first or second quarter of 2008.  I believe Donald also echoed that thought also.  Thanks again for coming by!

Esko, I totally agree with you about the real estate market being local.  I do believe in most cases now, it is a buyer's market.  It is a great time to buy where the market is down.  In San Francisco and San Jose areas it is hot with 8-9% appreciation.  We need to keep our eyes open to see for ourselves what are local markets are doing.  Take care my friend!

Rob, I believe Florida's real estate cycle is very similar right now.  We should be very near bottom within the next couple of months to six months.  What is the percentage of tax is paid in Florida?  We pay somewhere around 1.25% in the Sacramento Region.  Let me know what your figures are, I am very interested to know.  Thanks again for coming by and commenting!

It looks like we are getting some positive news that we are getting close to the bottom of the market.  Some say we are there and others say within the next 6 months.  We are close!

Check out these articles:

http://www.sacbee.com/845/story/556125.html

http://www.nwaonline.net/articles/2007/09/27/business/092807reinsight.txt