Now I may be accused of being a bit biased here, BUT take what I’m about to say seriously.
Many argue that the as home prices across the country continue to decline that they intend to wait until it “hits the bottom” before they jump off the fence and buy. Now it’s difficult for anyone to predict where the bottom is, and many times the bottom passes and on the slight incline the economy takes on it’s first few weeks of recovery many start to buy.
As the economy recovers interest rates will rise again. Take for example a 5.5% loan on a $218,900 mortgage (the rate some people grabbed a few weeks ago). They could expect to pay around 994.31 / month. If home prices were to drop 10% over the next year, to bring the home price to $197,010 and finance at a mere 6% – the payment would be $994.94 – not much difference. It pays to do the math – either way you’re going to pay about the same out of pocket.
Where someone potentially gains is if the market completely rebounds to it’s previous numbers, but I highly doubt that will happen quickly. The market corrected – and that’s a healthy part of any economic situation.
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