Now May Be the Time to Buy a Home
If you're into bottom-fishing, now may be the time to start trolling for real estate. At least that's the advice of
"I'm pretty comfortable saying that five years from now, people are going to be saying, 'Damn, if I had just bought in 2011,'" said Corbett, who is also host of the "Mansions & Millionaires" segment on the syndicated TV show "Extra."
"Prices are bumping along the bottom and interest rates are really low," he said. "When you have those two together, you have the perfect buying opportunity."
Housing prices may not have hit rock bottom, Corbett acknowledged. But he thinks that people who wait to find the market's bottom are likely to miss out on the current low interest rates.
And rates can be every bit as important to the cost of a deal as price.
You might think you can snag a great deal by lying in wait -- hoping that the owner of a
Assuming you finance
"It's hard to tell where the bottom of a market is, until prices start going up," said
What's the best strategy for bargain hunters?
Be wary of short sales
Many buyers think they're going to get the best deals by rescuing underwater borrowers through a short sale, Corbett said. In a short sale, a home is sold for less than what's owed on the mortgage.
But in order for the short sale to go through, the lender holding the mortgage has to agree to the underwater price. Many are, understandably, reluctant to do so. Realtors say that getting the existing lender's approval adds another layer of complexity to an already complicated transaction. In some cases, such deals can take months to approve.
"There's just no standard because every bank is different," Patton said. "I've seen short sales take anywhere from 30 days to eight or nine months."
Unless the existing lender has already said it's willing to accept a short-sale price that works for you, Corbett suggested you skip short sales entirely.
Foreclosures are another story, Patton said. Lenders who have seized a property are often more realistic about the value. In addition, they often fix up the homes before they list them, she said.
Look for what the real estate industry calls "battered histories"
That usually means one of three things: The home has been on the market for 90 days or more, the seller has cut the price numerous times or the home has had other offers that have fallen out of escrow.
Any of those factors could mean that the seller is getting anxious to get out and may be more willing to negotiate, Corbett said. That does not mean, however, that a low-ball offer is in order.
"The last thing you want to do when a homeowner already feels battered and beaten is insult them," he said. "If the house is appropriately priced, never make an offer that's more than 10 percent below the asking price. That's just insulting. The seller might not even counter back to you because they'd rather that somebody else got it."
If you're going to need a loan to buy, make sure you've already discussed your finances with a lender and are pre-qualified.
When there are multiple offers, the bidder who presents the most secure and attractive deal is the one who typically gets the home. If you're the one buyer whose offer isn't contingent on qualifying for a loan, you have a better chance.
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Real Estate - Now May Be the Time to Buy a Home
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