When Is a Good Time to Buy???
It's a question potential home buyers constantly ask themselves: When is a good time to buy?
In this day and age, we, as consumers, are incredibly savvy, and are no longer naive to the goings on within our economy. All around us, we see examples of a tumultuous real estate industry in a constant state of flux...
We see foreclosures, not just in lower income areas, but in the most affluent of neighborhoods as well.
Chances are, we have a friend or a family member or an acquaintance we know who is involved in the process of a "short sale" on their home.
Home prices and interest rates are constantly changing, and all around us people are buying like crazy, selling like crazy, or doing nothing like crazy.
As smart consumers, we're constantly evaluating these ebbs and flows and trying to determine the "right time to get in."
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| A metaphor of the real estate market: A constant sea of change. |
So when is that right time?
To answer this question, we have to put aside our traditional thinking and truly look at how the market can be an advantage for us today. On a traditional level, things used to be more black and white. All you had to do was determine for yourself when you thought prices bottomed out - and if you guessed right, you had a great deal on your hands.
Unfortunately, or rather, in my opinion, fortunately, these days are over.
If you find yourself on the sidelines in today's market waiting for prices to go down even further, you'll be waiting a very long time for evidence that may never show up. The fact of the matter is that we no longer should look at market averages and median prices on a whole, but rather, today, it's about finding the right deal at the right time for ourselves.
In other words, rather than waiting for the market to become more predictable and consistent, which could take years, or never, we can instead use the industry's "inconsistency" to our advantage to discover that great gem of a find.
Pick a neighborhood, and you'll see the examples all around you...
You'll find sellers who are not in distress list their home at a price-point well above market - these are the sellers who are unrealistic about the downturn and drop in home prices, and probably aren't all that motivated to sell. In this case, it isn't the "market" we have to wait on for these sellers to drop their price. Rather, its the sellers themselves who will lower their price when they're ready to be a bit more realistic with their expectations.
We'll most likely skip putting an offer in at asking price on this type of home because we're not going to get in on something we feel is being listed well-above market value, especially when we go two doors down, find a home very similar, only this one is an "approved short sale", with a much more realistic price point set by the bank.
Now, with this type of home, listed at a price that seems to be a sweet spot for the neighborhood, we're evaluating the opportunity individually to determine if this is the right investment for ourselves. The question we should ask ourselves here is not, "Should I hope the market gets worse and wait for the price of this home to drop even further?" but rather, "Is this the right price right now for me?"
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| No two homes side-by-side are ever alike, just as no two waves are ever identical. |
There's a reason why today, most likely you can't submit an offer on a home without competing against multiple other buyers. These buyers have determined that this home in particular is the right specific investment for them at this time. If we think we're going to wait for the price on this specific home to drop in order to submit an offer, we'll miss out on the opportunity because someone else will have snatched it up.
In other words, if you do your market research, and find a home you absolutely fall in love with, whether its a standard sale, a short sale, or a foreclosure, if the price point is comfortable for you, then be aggressive, and get it! If not, then move on to the next one. But don't get into the trap of falling in love with a home but deciding to wait to see if it drops in price. If you do, it could be gone the very next day!
Its easy to answer "right now" when our question is, "When is a good time to buy?" Every real estate professional will always say "right now" is the best time to buy no matter what state the industry is in. The point is that if you yourself are ready to buy right now, then right now IS the right time to buy because that incredible home is out there for you at the right price for you. All it takes is a little creativity and ingenuity (and a real estate agent who knows what they are doing and understands the market) to find the right opportunity for you.
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| When we seize Opportunity, the sea becomes calm. |
If you don't find that home today, then today wasn't the right time for you to buy. It isn't the market that makes that determination for you. Rather, its your heart that told you a particular opportunity wasn't the right one for you.
The market will always rise and fall. Home prices will always increase and decrease. The one constant that never changes is opportunity. Opportunity doesn't care about interest rates and market value, because it comes from the heart. When your brain does the calculations to narrow down your search, and your heart chooses a particular home, then that is the opportunity you will have been waiting for - that's when you know it was the right time to buy.
- Jeremy
Jeremy Howard is the Broker & President of Hpremiere Properties, (www.Hpremiere.com) a successful, prestigious modern real estate brokerage located in Southern California. He is also the territory owner for franchise development for Los Angeles County and Orange County of Casa Latino Real Estate, and is the Founder and CEO of Real Estate Dynamic (r.e.d.) (www.RealEstateDynamic.com), the most progressive and influential Social Club for entrepreneurial real estate professionals on the planet.
www.jerhow.com
