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"Is now the time to jump into the housing market or should I hold off?"
This seems to be the question of the moment in San Diego. Making the move into homeownership continues to be one of the most important decisions that most of us will ever make. It is a choice that requires thoughtful discussion with your financial advisor, family and other trusted individuals. For the thousands of San Diegans trying to weigh the pros and cons of owning vs. renting, here are some important factors to consider in the current housing environment:
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Improving Market: There is no reason to sit on the sidelines waiting for another dramatic drop in price, it has happened. We are experiencing increase in home prices at the entry level and limited inventory to support the demands. San Diego County has always been a desirable place to live, great weather and many sectors of business calling it home. Many Buyers sitting on the fence will miss out on the long-term appreciation gains and the tax advantages of homeownership.
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It's an investment you can live with: Unlike stocks, homes have utility value. You have to live somewhere, so make your investment work for you by building up equity while you benefit from the tax breaks.
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The bidding wars are over: Homes are realistically priced to move. But when you do find that dream house, act with conviction and don't miss out on it.
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The Fed has taken a breather: Interest rates remain at near-historic lows, and that equates to good buying power. The Federal Reserve paused in its interest rate hikes, but we are seeing it fluctuate and possibly up to 6% by the end of 2010 so now is a good time to make your move.
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Mortgage lenders want your business: The mortgage business has slowed along with housing sales. Most lenders are offering great loan programs and have of money to lend. One of them is sure to have a payment structure that fits your needs.
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Pre-approvals put you firmly in the driver's seat: It's still a good idea to get pre-approved for a mortgage and lock in your interest rate once a home is selected. You'll have more negotiating power with the seller and the ability to speed along the closing process.
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Cash is on the table: In some price ranges Sellers, eager to entertain your offer, are more than likely to make a deal that includes working with your lender to buy down your interest rate or covering the closing costs than they were a few years ago.
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Short Sales: Is an opportunity to purchase a home at a discounted price but can take 3-9 months to work through. Hire an agent who has experience with these types of transactions.
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Choices and options: As the market begins to turn once again to a sellers market in North County there is still the opportunity to own a home for the same amount you could rent it for. Remember you are purchasing a HOME a place to gather with friends, raise a family and create memories. Home ownership allows you to paint the walls colors you like, plant a garden and feel like you have roots.
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There's no time like the present: The most important fact for a buyer is to get in the game. Housing is a medium- to long-term investment. Over the past two decades, housing in San Diego has appreciated an average of 8 percent a year. How many stock portfolios or savings accounts can make the same claim?
Written by: Rick Hoffman, President & COO Coldwell Banker Residential Brokerage
San Diego Union Tribune
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