Why 2012 is your best time to buy a home?
Did you read that right? Have I not been reading the media? Prices are projected to drop, so why buy now?The questions is actually not whether you buy now, but if you have really thought this through as there truly is more to buying a home than just what is found on media reports.
Consider these things:
Interest Rates are low now!
Will they be low forever? No. However,low interest rates have more to do with buying a home then just getting a lower payment than rent. Consider if you buy a home for$300,000 at today's low rate of 3.6%, you will pay just under $52,000 in interest over five years. Compare that to buying a home of that value at a 6% interest rate (a likely interest rate in a few years)and you will pay $85,000 in interest. So, even though you may have earned more house for $300,000, you already will have lost $32,000off the top. If you also consider the cost of money lost to rent during that time, it is very likely that there is no advantage ofwaiting to buy a home.
Who cares if it drops in value?
If you home drops a little in value, is it that big of a deal? The only reason it should be a big deal is if you need to refinance your home shortly or if you want to sell it immediately. However, if you plan on living in the home and raising a family over the next ten years, small fluctuations in value will make NO difference to you at all. Your mortgage payment will stay the same and your lifestyle will not be affected.
Remember right now sellers are just as worried about the market as you are, but they have way more to lose.This means they are more likely to throw extras in or be flexible with the terms.
Remember, there is a difference in buying a home for investment purposes and buying a home to be your home. A home that is bought to raise your family should be evaluated differently.