Friday, February 27, 2009

Maria Mak - Buranby Realtor - To Buy or not to Buy now?



What goes up, must come down, vice versa; real estate is just like a roller coaster, up and down, down and up. Real estate, no matter how far it will descend, it will eventually rebound and climb back up again. Barring any intervention by Mother Nature, land will always be there. Land will not depreciate, and it's one of the best investments you can have in your financial portfolio.

Buy low and Sell high is always the golden rule for smart investors in real estate. Couple of years from now, when the financial crisis has ended and housing prices are up once more, we will look in the rearview mirror and realize that we missed a golden age for first-time home buyers.

Then, everyone who sat on their down payment savings accounts for a few years too long will kick themselves for not taking advantage of what may turn out to be the buying opportunity of a lifetime for those who can qualify for a mortgage.

Unfortunately, we do not know when this golden age will begin, because we will be able to identify a bottom to the housing market only with the benefit of hindsight. But as it does with the stock market, the moment will probably arrive when everyone is feeling the most pessimistic.That moment is certainly getting closer.

Housing prices have fallen drastically from their peak levels in many areas of the country.Meanwhile, first-time home buyers have the same advantage they have always had, which is that they do not have to sell their old place before buying a new one. That is an added advantage in areas where many available houses simply are not moving, because the people trying to sell them will not be bidding against you.If you’re hoping for a recovery in the housing market, you ought to be cheering on the first-time home buyers. When they purchase homes, their sellers are free to move on or move up, stimulating further sales.

But if you are a potential first-time buyer yourself, or lending or giving the down payment to one, you are probably as frightened as you are tempted by all the “For Sale” signs that have become “On Sale” signs. So let’s quickly review some of the still-grim pricing data in certain areas — and consider the reasoning offered up by first-time buyers who have forged ahead anyhow.

The fact is, in many parts of the country there are few if any attractive rentals for people looking to put down roots and enjoy the sort of amenities they may spot on cable television home improvement shows. Comparing a rental with a place that you may own seems almost pointless in these situations, especially for those who are now grown up enough to want to make their own decisions about d├ęcor without consulting the landlord.Still, for anyone feeling the urge to buy, a number of practical considerations have changed in the last year or two.

The basics are back, like spending no more than 28 percent of your pretax income on mortgage payments, taxes and insurance. Even if a lender does not hold you to this when you go in for preapproval, you should hold yourself to it.

For all your real estate services, please call Maria Mak and my team at Sutton Centre Realty at 604-839-6368 or visit my website at http://www.mariamak.com/, you’ll be smiling too!

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