According to Walter Updegrave of CNN Money, in his article entitled “House Hunting: Is this The Right Time to Buy?”, the American consumer is just not smart enough to time the real estate market….even though many economists are calling for a double-dip in home prices and a 28% decrease in the national median home value. In fact, in Mr. Updegrave’s response to a newly married Los Angeles couple, he writes: “Is it possible that prices might go lower still from here? Sure. But it’s unrealistic to expect to call the bottom of the market and time your purchase just right.” He also offers up many up the middle safe comments in this article that may be seen as a call to action to buy now. I find his reporting to be, at best, irresponsible journalism and, at worst, coaxed.
In my opinion, Mr. Upgrave displays a lack of genuine concern for his readers because the economic data clearly points to a double dip in home prices both in North Orange County and Los Angeles.
I challenge Mr. Upgrade to respond to my post. Why can’t we time the real estate market? I tknow that we can because I have seen it accomplished successfully twice in my lifetime by family and friends. I have even timed it right myself becuse of the courage I had gained from seeing it done in past bubbles.
It is very crucial for first-time home buyers to time the market right because their ability to move up is contingent on how successful they were at buying an appreciating asset and not a loss leader. My advice to them is as follows: if you have no immediate need for tax shelter, then sit it out till the end of this year or even into the end of the first quarter of 2012. By doing this, I know that you may save 7% to 10% on the cost of your first home. This savings will be part of your down payment on your next home as your family grows.
My advice to investors is that if you have an immediate need for tax shelter that can offset the equity loss that you will inherit by buying at current prices, then buy now and at a price that is, if possible, 10% below what recent (30 days or less) comps. support.
As always each individual case is different and one should consult with their accountant and attorney before making big financial decisions.