With all the trouble in the housing market right now, you may think it’s the worst time to invest in real estate. For some of you that may be true; after all, you can’t buy any home if you are taking a bath in the stock market or on the verge of losing your job. But for others, the housing market slump may be just the thing you’ve been waiting for. With more and more homes going into foreclosure everyday and sellers getting so desperate to get out of the house they can no longer afford, there are many deals in real estate popping up all over the nation.
The next question you have to ask yourself is whether or not now is the right time to buy, or should you wait a little bit longer and see if the prices in the housing market will go down even further. That’s a much trickier proposition; and with the government seizure of IndyMac Bank, people are much more nervous to seek out a mortgage loan. After all, who knows what mortgage lender is the next to bite the dust. Let me just say this, real estate, especially here in California, is always a good investment. That being said, you have to feel fairly certain you can keep up with all your bills, not just your mortgage payment, before you decide to take the plunge.
I’ve discussed this topic several times in my blog, but I feel it is of the utmost importance to warn anybody who thinks they can make a bundle by purchasing real estate that is in foreclosure that you will have to look at that purchase as a long-term investment. The housing market will turn around, it always does. However, it can be upwards of five years before it becomes a seller’s market again. You also have to take into consideration the condition the economy is currently in. The government has stated that they see inflation leveling off later this year, but we can’t be sure of that, and with gas prices rising and people losing their jobs, you may want to wait a while before you go seeking out that mortgage loan.
Now if you think you can afford to get into the housing market right now, the first thing you want to do is make sure you seek out reputable professionals. You want to read everything in your mortgage contract thoroughly to make sure there are no hidden fees, you want to hire yourself a good real estate agent who has the experience to steer you in the best area to purchase your new home and you want to get the home appraised by a licensed real estate appraiser. The real estate appraiser will research the area you are thinking of buying in and make sure you are paying the fair market value for that home.
Also keep in mind that the government is working on several bills that will keep a tighter reign on mortgage lenders like Fannie Mae and Freddie Mac, so you might want to wait until those go into effect as well. Take this knowledge with you as you go in search of your next piece of real estate, and remember that the housing market goes in cycles. As long as you don’t expect to turn right around and sell it for a profit, now may be the right time for you to purchase your next home.