Has the housing market bottomed out yet or should I wait to buy? How much longer?

Has the housing market bottomed out yet or should I wait to buy? How much longer?

The smart money says at least another year to go. BUT it still depends on where you are. Even though the problem is very wide-spread, it's really bad in many places but others haven't been affected at all.

Are you buying for investment or will it be your primary residence?

Are you buying for investment or will it be your primary residence?


Not sure yet. Since I probably won't be able to sell the one I'm in for a decent profit I'll probably rent out the new or old one.

Not sure yet. Since I probably won't be able to sell the one I'm in for a decent profit I'll probably rent out the new or old one.

One nice thing about a slow market for house purchases is that it drives up rent prices, so it shouldn't be too hard to finance such a purchase that way. The downside is that you'll probably have to wait for quite a while for the price of the house to appreciate significantly. It really depends on how long you plan to keep the house; if you're thinking less than five years, the down-payment money would probably be better-invested elsewhere.

Has the housing market bottomed out yet or should I wait to buy? How much longer?

It depends on where you live. Where I am the average house prices are UP 4 percent from last year even though there are more houses on the market than last year and interest rates are also higher.

Greenspan said housing prices will continue to fall. Go with Greenspan, if you are in a location that has been hit by falling prices, e.g. Florida, California. If prices have not fallen in your area, don't expect a decline - so you might as well buy now.

Has the housing market bottomed out yet or should I wait to buy? How much longer?
If you buy for yourself, it is better to wait till it they start going up again (keep looking and when you notice the market is starting to get up again, buy it).

If you are investing....
It's always a good time to buy a house, if you are a good investor. Having said that, let's assume you are. (Good for you!) :D

If prices have been rising for a while and houses are getting more expensive then people can afford, don't buy.

If prices are falling, it's a good time to buy. You see, you don't make money when you sell a house, you make money when you buy. If the prices are falling chances are the rents are going to fall too. In this case, the rents are still high, but since you can get a bargain for the house, you can charge lower rents and still get a profit when paying the mortgage and all the other expenses. However, beware not to buy when the prices are only starting to go down, otherwise you might lose money in the long run, if you want to sell later. Buy it after the prices have gone down considerably, so that when the market picks up again, you are not stuck with a price too high. Of course, this usually won't happen if you want to hold the house for a very long time, which is why cashflow is the essential profit and this "bad" market is actually good for investors. Find people who are desperate to sell and you might not even need to make a downpayment....

As for markets where prices are just starting to go up, they are also good (in fact ideal) since your cashflow from rentals would be good and the value of the house would also increase quite dramatically over the years.

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Liability waiver: this post is not to be taken as financial advice. :D

Btw, if you wanna get really fancy with your speculations, you can always make calculations using derivatives. That way you would be able to find out when the down curve will turn concave down.... :D