Friday, November 9, 2007

Is now a good time?

In sitting down to write today's entry, I realized it was Friday and time for the Weekend Events series. I was excited to see what the weekend would bring as I started to gather the info and choose the events to be featured. I first went to sfgate as they have a good entertainment section. Of course I got distracted with the real estate section, and I clicked on Carol Lloyd's Surreal Estate article titled, "What's happening now in the reportedly stormy San Francisco housing market?". Quite a title, isn't it?

She goes on to talk about how she was confused by the contradictory information she was receiving from the media versus that from real estate agents. The media was telling her that home prices are falling, but agents will talk about multiple offers and overbidding. Which is it? She concludes that San Francisco is unique and even backs it up with a statistic showing a small rise in median home prices in San Francisco as a whole over the past year.

Don't be confused. When you hear California or Bay Area statistics, they are not San Francisco specific. San Francisco is unique; the housing market here is unique. Of course the country's financial health overall will have an impact on San Francisco; we are not immune to that, but housing prices and market trends are specific to this city, and specific to each neighborhood within the city.

Lloyd also talks about hearing stories from buyers and sellers that seem to be in line with what Realtors are telling her. I clicked on the comments below the article because I was curious to see what peoples' reactions were to the article. That was a mistake. People's comments about Realtors were all but friendly. The general consensus was that the Realtors will always tell you that it is a good time to buy, so don't listen to them.

That sure makes me feel good! Here is the bottom line as we see it. The time to buy is when you need a home or want to move. The fact is that when the market was at it's peak and prices were soaring, it was a terrible time to buy. People were writing an average of six offers before they got one accepted, and they were paying 20% over asking with no contingencies to finally get it. It wasn't a good time to buy, but people were buying; enough people to generate that type of insane competition.

It is not that way anymore. Things have slowed down. People are able to negotiate decent and smart deals. Yes, some properties generate multiple bids and sell over asking, but the numbers are smaller. Now is a much better time to buy. I can't tell you what it will be like in six months.

There are always people sitting on the sidelines and asking the question, "Is now a good time?" I can finally say without a doubt that it is. What a surprise, the Realtor is telling you that now is a good time. More important than what I tell you or what the market tells you is what your family needs. Do you need a bigger home? Do you need a garden for the children to play in? Do you need to move to a safer neighborhood? Are you simply tired of paying your landlord's mortgage?

When you decide it is time, look specifically at the neighborhoods where you want to live. Look at the prices and the trends of that specific neighborhood. Even beyond that, you need to look specifically at each property's situation. Averages, medians, and trends will only help to a certain point. Each situation is different, and it takes the highs and the lows to create an average.

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