Plan on buying a house

ou have the money and a stable job that doesn't plan on letting you go, do it.You will never have the gov 8k incentive again.I was watching tv last night and somewhere in az they are giving you 15k to cover all closing costs.Nows the time to buy.If you own a home before 25 then you're about 12 years ahead of the crownd BOL

I never meant to cause confusion or disrespect to being Estes.

Time is on your side,,,,,,once the 8k goes away, then prices will continue to fall because every sap buying a house will be bringing 8k less to the table.  What you ought to do is save up for another year or two and wait for interest rates to go up, that will really drive prices down. 

Things to think about if you really feel the need to buy.

How long will you be in the house?  Unless you expect to be in the same area for 10+ years, might want to rent because prices will be falling for a long time, and once you buy a house you're tied to that area, it's costly to sell the house and move and buy another.

Is it cheaper to rent a similar house?  If so then you should be renting, house prices won't bottom until it makes sense to buy a house with the purpose of renting it out and making money.  The myth is 'renters don't get to build equity' WRONG, renters don't have to pay taxes/maintenance and upkeep, are free to pick up and move and are worry free on the house and it's problems, renters have the freedom to save all that extra scratch and build a savings that is as liquid as it gets, not dependent on house prices rising forever.

The best summary explanation, from Business Week: "Today's housing prices are predicated on an impossible combination: the strong growth in income and asset values of a strong economy, plus the ultra-low interest rates of a weak economy. Either the economy's long-term prospects will get worse or rates will rise. In either scenario, housing will weaken." 

everyone and their mother will tell you all the lies and myths about homeownership and tell you now is a good time to buy or that it's a good investment,,,,,hogwash.  If you are serious about buying a house, you need to find all the negatives to it before hand, and you have to look, because all you'll ever hear is all the bs propaganda from the crooked ass NAR. 


other things to think about, for your area, because RE really is a local phenomenon and every market is different.  What's the job situation look like in your area?  How bad did house prices bubble up in your area from '97-'06?  HOw good have they came back down to normalcy ( at maximum 3x incomes)?  How long do you expect all house sales to be dependent on 8k gov't credits, gov't subsidized loans that require little to no downpayment, and interest rates as close to zero% as they're ever going to get?  Every single possible factor points to housing prices declining, and not just a little bit for a short while, i'm talking a lot bit for a long while.

if you can wait, definitely wait

increasing foreclosures = prices going down
increasing unemployment = prices going down
wages, salaries being cut = prices going down
all those people that are barely able to make their mortgage payments right now = prices going down
the millions of foreclosed homes that the banks are keeping off the market, which they will have to release eventually = prices going down

if you absolutely have to buy right now, then you will get a good price
but if you can wait, you'll get a much better price

Yeah, I gotta side with Aruba on this one... That is pretty lame.

which is actually false,,,,,when was the last time everyone wasn't saying 'now is the time to buy'? 'but now or be priced out forever'


the time to buy is when you can afford to put 20%+ down on a house and the purchase price is at most 3x your annual income.

National house prices peaked 4thQ '06, and since this is a gambling site and all, my bet would be prices trend downward for at least the next 10 years. Think of all the trickery used to artificially push prices upwards over the last 11 years,,,,,compound that with all the bullshit gov't intervention into the housing market recently to prop up the phony prices,,,,,and we have a ways to go down still

as a gambling man, would you bet on being able to continue to depend on having the mort int deduction for the life of a mortgage?  plans are already in the works to reduce the amount of the deductions allowed, part of Obama plans to pay for healthcare. 

plain and simple housing is still way overpriced, and the job situation is very bad with no hope in sight.  Interest rates are as low as they can go, so inevitably they will rise.  As rates go up, prices will come down

Do it, I got my first house at 18, well that's a lie, my dad gave me the money for the first place at 18, it was a student house in my university town, lived for free plus had positive cash flow every month.  After 4 years sold it, was up about $25K in equity/appreciation/Cash, paid my dad back with the monthly cash flow.  Bought a condo, at 22/23, still living it, had a roommate first year, who slept in my den lol.  Maybe you want to do the same, treat is kinda as a business, rent out a room or two to friends, especially if its an actual house.

 Almost all my friends are renting, and are  now making plans for down payments.  Most people are not in our situation, where parents can help out,  do i young, it is so much easier to move into a bigger place once you have one.  Plus you will have equity/appreciation/increased line of credit.  Your monthly outlay is going to be more  vs renting as well, so even if you have to pick something up and rent out a room or two, do it up.  Plus you guys have the government helping you out for first time place?  Thats wicked, we didn't, just pay less on the land transfer fee here in Ontario

The big thing is USA vs Canada (Toronto are more specifically). is the market itself, not sure where you are or how the market is.  I bought my condo for $180, similar ones, are now selling for $220, huge jump in a bad market, if I can get 3%/year for a couple more years I can sell for around $235K mark.  But the Toronto market never really took a big hit last year, it was flat, especially for condo's, than boomed again this summer with huge increases.  So look at your market to see how it will do over next few years.

please stop giving out the worst advice in the history of advice

 

Easy..you ever think of the enjoyment of owning your own home? It seems its always dollars and cents. Gimmedempoints might like being able to paint his house pink with purple polka dots, burn Dale Earnhardt's #88 in his front yard, have a pet, put a stripper pole on the roof, etc. Why? Because he can. He owns his own home. A large part of homeownership is the potential financial gain, however looking outside of the $ box, and realizing that not living with the parents and enjoying home ownership also has value. A lot of first time homebuyers are experiencing the JOY of homeownership over a long term. If timing the real estate market was as easy as you make it seem, you would surely be retired on a yacht somewhere.

Either way, it's an investment, and now is the time to buy if you can...right?  Just curious what people are hearing.

this is the last sentence in the OP's first post. 

Do i ever think of the enjoyment of owning?  Yes, i'm reminded every day,,,,,,the thing of it is, all the emotional pro's are repeated ad nauseum, that's part of the reason (imo the main reason) we are where we are today as a society/economy.  What i find deeply problematic about all these agreed upon fallacies about homeownership is just that, they are FALSE.  House prices tracked inflation forever, it's only in this recent bubble era that they went batshit.


 Gimmedempoints might like being able to paint his house pink with purple polka dots, burn Dale Earnhardt's #88 in his front yard, have a pet, put a stripper pole on the roof, etc. Why? Because he can. He owns his own home

I'm not sure how many places these days that you would be allowed to do any of that, if it's not in some type of housing association with a google of restrictions, then it's in a city or township that likely has a dickload of laws prohibiting a 'homeowner' from doing anything they'd like to do.  Most anywhere has laws/restrictions on what you can do with 'your' property,,,,how long you're allowed to let your grass grow, if you're allowed to build a deck or a fence, and certainly, no stripper poles on the roof


 A large part of homeownership is the potential financial gain, however looking outside of the $ box, and realizing that not living with the parents and enjoying home ownership also has value. A lot of first time homebuyers are experiencing the JOY of homeownership over a long term.



I would think that good advice to anyone contemplating buying a house (especially starter house for a first time house debtor) is that there is damn near zero chance that there will be ANY financial gain, certainly not in the next 10 years,,,,not to mention if you would need to sell the house to realize the gains (the alternative being when you upgrade to ur next house, keeping the first property as a rental) you take a major hit from selling (realtor fees + taxes and seller help,,,,,,).

Now if you want to get sucked into the emotional part of the 'investment' in house'owner'ship, that's fine by me,,,,,however if you want to discuss it as an investment, then that is a dollars & cents conversation,,,,,,sure it's fair to say that the emotional attatchment carries some value to someone, but that's not good thinking when making the biggest ticket purchase of your life


If timing the real estate market was as easy as you make it seem, you would surely be retired on a yacht somewhere

yes and no,,,,,i've been beating the dead housing horse on this forum for close to 30months.  I believe what i type, and do so in hopes of helping others.  I bought 7/07, less then a year post peak of the housing bubble,,,,and i did so knowing full well what was coming, i bought at steep discount and was figuring on the sticker price of my house dropping by as much as 25% from what comps were selling for in my zip at that time,,,,,i was wrong, because come to find i bought in one of the most thriving RE markets post bubble burst,,,,,some would be happy about that, but it's my belief that prices of everything follow prices of housing (thats why they call it cost of living).  I still root for prices to drop in my area, because no way in hell do i want to pay MORE property taxes moving forward, and i don't ever intend on selling,,,