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It’s Time for Savvy Buyers to Snap Up Real Estate in Ridgewood New Jersey

By Aloysius Donohue

Real Estate Agent with Keller Williams Realty

October 19, 2008 01:32 PM

There are some incredible deals on Ridgewood Homes in today’s market.

Everyone knows you are supposed to buy low and sell high. It seems to be a simple enough premise but why then are there so few people that are willing or able to pull the trigger today? The main reason is that when the market is “low” folks are understandably afraid to make big decisions of any kind. They prefer to buy when everyone else is buying (aka herd mentality) which is usually at, or near, a market top. This is precisely the wrong time to buy Ridgewood Real Estate and the same goes for stocks. Buy low-Sell High is easier said than done. This strategy has been proven to work time and time again, but it takes some serious intestinal fortitude coupled with a high risk tolerance.

Jeffrey Otteau, the renowned pricing guru of NJ real estate, was quoted in today’s Bergen Record saying that there are 3 reasons that it might be a good idea to buy a Bergen County Home in the next 6 months.

Jeffrey Otteau’s 3 Reasons for Buying a New Jersey Home over the next 6 Months

1. Home sellers are generally in a weaker position over the winter.

2. The bottom of the market, when it does occur, will emerge out of the shadows. Once the change occurs there will be no way to go back to the strength the buyer had when the market was at the bottom.

3. According to Otteau, “It is probable that interest rates are on there way back up.”

Let’s examine some other facts regarding today’s Ridgewood Real Estate Market

Prices have come down but if you are a first time buyer or a trade up buyer - this is good news for you. Let’s say prices have come down by 10%. If you are trading up from a $500,000 Ridgewood Home to a $1,000,000 Ridgewood Property that means you will get $50,000 less for your current home but you will also pay $100,000 less for your new home. A net gain of $50,000.
Interest rates remain low - at least for the time being. However, many experts say both current events and long term market trends point to an uptick in interest rates in the near future. I agree with Mr. Otteau here.
Inventory is still relatively high so buyers have lots of homes to choose from and can probably drive a pretty good bargain.
The rules for capital gains exclusions are changing. Depending on your specific situation, it may make a huge financial difference to you if you sell your Ridgewood home before January 1st 2009 - as this is when the new rules kick in. Click here to learn more about the new capital gains exclusion rules.

I’d be very happy to show you what I think are some of the very best values in Ridgewood Real Estate. Please call me at 201.906.3287, email me at aldonohue@optonline.net or simply leave a comment here.

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It’s Time for Savvy Buyers to Snap Up Real Estate in Ridgewood New Jersey.

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Judy Greenberg

Compass - Long Grove, IL

Compass- Long Grove -Buffalo Grove

Al, I didn't realize they were changing the capital gain rules starting next year. Thanks for the heads up! As I understand the rules, it means that it will be less benefiicial for people to rent out their homes than before... Am I right?

Oct 19, 2008 01:45 PM

Aloysius Donohue

Keller Williams Realty - Ridgewood, NJ

Ridgewood Real Estate

J-Berg- You are correct as usual. You do not miss a beat. Best Realtor in "The Grove" as far as I am concerned.

Oct 19, 2008 01:53 PM

A-sius, Hope you have a nice day!

Oct 20, 2008 12:16 AM

Chris Brown- Florida Home Loan Specialist | Certified Mortgage Planner

Chris Brown | Certified Mortgage Planners - Orlando, FL

Chris Brown 407.367.2974

Al... i especially like reason #2 very nice!

chris the implementer

Oct 20, 2008 02:08 AM

Karen Rice Keller Williams Real Est

Keller Williams Real Estate - Hawley, PA

Northeast PA & Lake Wallenpaupack Home Sales

Thanks for posting the capital gains info - very interesting.

I recently sold a house here to folks originally from Ridgewood.

Oct 20, 2008 05:48 AM

Bill Gassett

RE/MAX Executive Realty - Hopkinton, MA

Metrowest Massachusetts Real Estate

Al I would disagree. I think it has more to do with the fact that consensus on the Street is that many markets across the United States have not hit bottom and are continuing to drop. It is much like the stock market where people are trying to time the market and get in at the bottom. There are plenty of folks sitting on the sidelines right now that could become buyers at some point. When you pick up the paper or listen to the TV and hear the media constantly talking about the continued drop in housing values it is not that big a surprise.

Oct 20, 2008 11:43 AM

Chris the implementer - Thanks very much.

Oct 20, 2008 12:19 PM

Karen - You are very welcome.

Oct 20, 2008 12:20 PM

Bill - I think we are in violent agreement. I agree with everything you said but I think it supports my point. I realize the news is bad and folks are frozen with fear but that is usually the time to buy - when things look bleakest. By the time the forecasts have become rosy and prices are increasing again you will have missed your chance to buy low. Buy low, sell high is easier said than done but that is why folks make so much money doing it.

Oct 20, 2008 12:23 PM

Kathleen Buckley

STAR REALTY Hopkinton - Hopkinton, MA

Hopkinton Specialist

Al- Okay your blog is far too rich for my overloaded mind to take in. YOu're just too good. I feel inadequate around you.

The new capital gains exclusion rules make a lot of sense in fact. The first I heard of it was right here on your intense blog post. The old 2 out of 5 rule never made sense to me because I could have two home simultaneously and live in each for 2 out of the past 5 years, and still get the exclusion on both.

Oct 22, 2008 01:37 PM

Mary Pope-Handy

Christie's International Real Estate Sereno - Los Gatos, CA

CRS, CIPS, ABR, SRES, Silicon Valley

Great post, Al. I think your buddy Jeffrey is right on all three points. "Even if" prices do go down, if interest rates rise, which I also think they will do, homes will cost more because people are buying both the house and the loan (unless they're all cash).

Most consumers are more careful and afraid than opportunists and risk-takers. Right now, the folks looking for opportunities are cleaning up while those who are afraid (about 70% of the population) wait until prices are going up. Sometime down the road, it will feel riskier to wait then to buy and they will jump in then - having long missed the bottom of the market.

Oct 22, 2008 03:26 PM

Lee Cunningham

Cunningham Team RE/MAX R.P. - Greenville, SC

Greenville SC Real Estate

Yes, smart investors buy when blood is running in the streets. It's the same for real estate. You just need some cash for down payment in these times.

Oct 30, 2008 01:10 AM

Kathleen in Hopkinton - What are you buttering me up for. You are not normally this nice to me.

Nov 01, 2008 01:08 PM

Mrs. Pope Handy - Thanks for your note. I agree with you and Jeffery. Now we just need our clients to see the light.

Lee - The blood is running. Please send the investors.

Nov 01, 2008 01:10 PM