What possible reason could you have to buy a home this year? Letâ€™s analyze the facts.
1)Â Â Â Interest rates down to 5.5% – the takeover of Freddie Mac and Fannie Mae have the rates tumbling. Why on earth would anyone want to pay a low interest rate like this when we could wait for double digit mortgage rates. I mean at 11% interest we would get twice the write off on our taxes wouldnâ€™t we?
2)Â Â Â $7500 tax credit for first time home buyers. You heard me right that is a tax credit â€“ not a deduction. Of course if we wait on 11% mortgage rates we will have a pretty big deduction anyway so we may not want or need this $7500 tax CREDIT!
3)Â Â Â Seller incentives are at all time highs. Sellers are almost certainly going to pay all your closing costs.Â They may also be willing to throw in a refrigerator, privacy fence, and who knows what else.Â But who needs all that stuff!Â I would really rather pay my own closing costs and other expenses to get into a home as this makes me more independent.Â Â Â Again, I can write that off on my taxes â€“ right?
4)Â Â Â Homes are at bargain prices compared to a couple of years ago! We donâ€™t want to buy when prices are down though â€“ do we? It is always better to buy high and sell low isnâ€™t it?Â Â Â If we bought now we might make a big profit in a few years â€“ what would we do with all that money?
Any rational person can see that buying a home in 2008 would be a huge mistake.Â Waiting a couple of years to buy a home would obviously be the wise decision.