Quit buying the media’s sensationalistic bad news because there’s a break in the clouds for a limited time only. Anyone taking advantage of this fact will have bragging rights in their new homes at BBQs for years to come.

Here’s four reasons why to buy and even sell if you have to:

First, The real estate “bubble” is now gone. Home prices have already corrected completely, retreating from their irrational bubble levels back to their consistent historical and increasing average line of approx 4% annually. Real estate is priced correctly more everyday. The sell-off that’s most likely still to come will be over-selling, and prices will correct back up to the aforementioned moving average when the economy improves as the recession ends over roughly the next three to five years. Not much room for flipping homes for investors but more certainty for new buyers looking for a measured rate of return who see the merit of living in their investment particularly as stocks, commodities futures like ETFs and bonds fall prey to bearish psychology and government backroom deal making.

Second, we are currently enjoying a perfect opportunity in the real estate market as usually there is an inverse relationship between home prices and mortgage rates (high prices accompanying low rates, or low prices with high rates). Usually a buyer has only two options, either paying too much for their home in a seller’s market or paying too high a mortgage rate in a buyer’s market. This relationship between price and interest rate determines affordability. 2009 is an aberration, with both home prices and their interest rates are low at the same time. As a result, housing is very affordable right now, making 2009 the best buying opportunity we’ve seen since the ’70s and the best we’ll see until rates creep up. Nearly two-thirds of current sales are first-time home buyers. For anyone looking to get into the market for the first time, right now is your chance while housing is affordable. There will not be a better buying opportunity than this year for the duration of the Obama Administration particularly with all the regulation it proposes to permanently correct the behavioral human error that contributed to this aberration along with its already implemented first time home buyer tax incentives and relinquished moratorium on foreclosures from November 08′ to March 31st of this year urging such correction. There is even a push for innovative programs like Rent-to-own programs, in which a portion of rent goes toward a down payment, which are also are being revived in some communities with too many foreclosed homes. Expect rates to creep up folks. The opportunity gap is closing. The government wants to stimulate the economy through the housing market so that as consumers are encouraged to borrow more money then banks may tap demand and raise their rates ahead of that demand to make profits again so they can start paying back their TARP funds.

Third, today’s historically low interest rates offer a refinancing opportunity. If you are currently paying more than 5%, give us a call. I can size up your situation and get you into a lower monthly payment with minimal effort on your part with the largest and most consolidated player in the market emerging after May 1st: Bank Of America’s Countrywide. And If you have investments or cash of 500k or more, then I have a banker for you offering even better competitive rates and floaters.

Fourth, if you’re thinking of selling, you have an opportunity right now to get your home listed and sold while prices are firmed up and buying activity is strong and encouraged. We’re coming into the optimal selling season, Spring and Summer, and the bulk of your would-be competition (bank REOs) are on hold until approx the Fall since, “Fannie Mae said in a brief statement from spokesman Brian Faith that ‘Fannie Mae’s suspension of foreclosure-related evictions concludes as of March 31, 2009. The company has in place special foreclosure sale requirements that take into account the Making Home Affordable program. A foreclosure sale may not occur on any Fannie Mae loan until the loan servicer verifies that the borrower is ineligible for a Home Affordable Modification and all other foreclosure prevention alternatives have been exhausted.’” If you plan to keep your property for years, call us for a refinance as stated above instead. But if you’re thinking of selling any time in the next year or two, you would do well to list your property right now. I’ll help you make the most of this window of opportunity and get your property sold before the banks are allowed to process foreclosures again.

Remember to Invest with Vision!

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Filed under: Commentary, Credit, Current Events, Foreclosure, Money-Saving, Mortgage, Real Estate Market, Relocating to LA, Selling