Over the last couple of weeks I've had the opportunity to talk with several people who are in no way connected with the St Louis real estate market or the St Louis mortgage markets. These were everyday people, one guy worked for the phone company. Another lady works as a recruiter for a local college here. Yet another was a supervisor on an automobile assembly line.
The one thing that these folks had in common was that they all asked me about the current slump in housing. The assembly line supervisor asked me directly if now was a good time to buy a home. She expressed concern that home values were going down and wanted to know that was a trend that was going to continue. She was also worried about a few credit problems that were left over from her divorce 3 years ago.
In response to her first question, I responded that while no one know 100% for sure where housing values are going to go in the future, that home prices generally will keep pace with inflation (all other considerations being held constant.) As I've pointed out on my blog before, if the costs of nails and roofing shingles goes up, the price of homes are going to go up as well.
Now that's not to say that some markets haven't been overbuilt and that in the short run that home prices can't fall, but in the long run, home prices are going to continue to rise.
In response to her second question, I told her that, no matter what she's heard in the news, that home loans for people with at least half way decent credit are still readily available. Yes, the investors are making people jump through some pretty stupid hoops, but for the most part, credit is still available for those with verifiable incomes and decent credit.
So, as I pointed out to these folks; The market is currently in the dumps, but I don't expect it to stay there a terribly long period of time. My crystal ball says that we're going to see a bottom sometime next year. When investing in a long term asset such as a home, 1 year aint nutin!
Right now there is a ton to pick from and with sellers fighting for you to buy their home, a good deal should be available to be had!
Let me know what you think!