Real Estate is On Sale!
It’s been a while since we made a blog post, partly due to the holidays, but partly because we have been busy with several new buyers. Why, in an uncertain economy, are so many buyers jumping into the real estate market? Do they know something you don’t know? It’s really quite simple - the current market condition represents an unprecedented opportunity for home / condo buyers. So what makes now such a great time to buy?
It’s a buyer’s market.
That’s because there are currently many more people trying to sell real estate than there are people willing and able to buy. That means prices are lower and sellers are more negotiable now than in the past.
Scarcity = Leverage.
Qualified buyers have the power. Not only are there fewer buyers than there are sellers overall, but banks are being more strict on their lending standards. Gone are the no-doc “liar’s loans”, sub-prime, Alt-A and other crazy loan products that created the financial mess we’re in. These tougher standards make qualified buyers even more scarce. If you are a qualified buyer in this market, you are the rare gem. This gives you the upper hand in negotiations.
Mortgage rates near 50-year lows.
Not only can you get a reduced purchase price on a home, but your cost to borrow money is also at historical lows. Many Atlanta mortgage lenders have reported rates under 5% for a 30-year fixed-rate mortgage! This also increases your buying power, enables you to buy more home for a given payment, or get a lower payment on a given home.
People are funny.
Human behavior is sometimes irrational and we often repeat our own mistakes time and time again. After stocks have fallen, people feel they need to “get out of the market” and end up selling at the stock’s lowest point. Then they wait for the market to “recover” and jump back in after missing substantial gains. Sell low and buy high? That’s not how you create wealth. The same concept is true for homes.
Real Estate is “On Sale”!
If someone told you that prices of flat screen TV’s have dropped this season, you might be more likely to buy one. Yet the same, normally logical person may hesitate buying a home because they hear in the press that the real estate market is depressed. The press reports might sound like doom and gloom, but what they’re really telling you is that houses and condos are on sale! That flat screen TV will do nothing but depreciate in value. On the other hand, that home that you buy at a bargain price today will surely appreciate in the long run. So what are you waiting for? Real estate is on sale!