I am asked all the time whether this is the time to buy real estate or not. The long answer depends on your individual circumstances, but the short answer (in my opinion) right now is yes!
Most people say they are waiting for real estate prices to bottom out. But how will you know when prices have bottomed out? When prices start to climb again - and by then you've missed the bottom. It's like trying to time the bottom when buying stocks; investors wait on the sidelines for the market to decline while they're actually watching it recover. We've already seen a market correction and lower real estate prices. History shows us that real estate prices will go up again. What better time to buy is there than that?
My second reason for buying now is to take advantage of historically low interest rates. The prime rate is 3.00% - are you waiting fro this to go lower? You may be in for a surprise! Interest rates have been declining for the past 20 years and are now lower than the rate of inflation, but that puts upward pressure on the rates. War causes inflation ... and guess what? Whether we want to be or not North America is at war. The current economic crisis has also forced the Canadian and American governments to borrow large sums of money, pumping more currency into the economy in order to avoid a deflationary spiral. Inflation is the result, and the cure is to raise interest rates to try to slow things down again. If we are close to the bottom of a cycle now, the only way to go is up.
So my advice is not to wait unless you have to. Warren Buffet says that he made his fortune not by 'buying low and selling high', but by doing the opposite of the herd. When everyone else is selling, he is buying. So if it seems that every other house on the block is for sale, that is the time to buy.