Let's party like its 1999

The big question out there: Is it time to buy, or not time to buy?

Here are the three latest sources to weigh in on the subject:

Time to buy

Forbes magazine: based on estimated 2008 inventory, sales rates, etc. the authors notes that Orlando has had a 2.4% decline but it is expected to turn around fairly quickly.

Not time to buy

PMI Mortgage Insurance Co.: Orlando is one of 11 metro areas with a greater than 50 percent chance of price declines over 2008 and 2009.

Time to buy

Jerry Jackson at the Orlando Sentinel: Resales of existing homes and condos had it's worse month in September in more than 8 and a half years.

Predicting the lowest point is a lot like predicting the stock market.....Yet remember, any home purchase can be a good investment if it is considered a LONG TERM investment.......

Where are the buyers?

This time last year, I had just started selling real estate in Orlando. Well, to be honest, I was recovering from an appendicitis after having just started working for RE/MAX 200. Boy, a lot can happen in a year.....

I'm sorry. I digress. In this last year, I have watched everyone call this market a "buyer's market." Yet as I reflect over the last year, I wonder where the buyers are hiding.

Don't get me wrong.....there are people out there looking, and there is a lot of inventory to choose from---over 25,000 in our area, to be exact. Yet the sales each month have been minimal. Now prices are significantly dropping, yet we are not seeing an increase in sales at this point in the year as predicted by the experts.

My take on the situation is that there are a lot of buyers sitting on the sidelines, waiting. Why, I am not sure----I know there has to be a lot of pent up demand. Even in a slow market, we see about 2,000 people moving into the city every day. Is everyone waiting for the prices to hit rock bottom? How will they know when that is happening? The statistics in the papers and used by experts are always outdated.

As I ponder my first year and this interesting question, I will be conducting a survey among my contacts and I'll report back.....yet I guess that trying to figure out the reason why won't bring people off the sidelines!

I don't have a crystal ball......

...so I read a lot about the real estate market from experts in the field. The chief economist for the National Association of Realtors, David Lereah, states that existing-home sales are projected at 6.42 million this year, and 6.66 million in 2008, compared with 6.48 million last year. Although some home sales will be reduced by the sub-prime loan restrictions, they should be gradually rising this year and next.

I know I am sounding like a broken record, but this is a good time to buy!

Are you ready to buy?

With all the discussions about sub-prime loans and home prices, many of the people I talk with are concerned they can't afford a home. You do need savings to be a good homeowner, for maintenance and emergencies.

But how much is too much to spend on a house?

The rule of thumb is 33%. Your monthly housing costs, including principal, interest, taxes and insurance should not be more than 33% of your gross income. With all your other loans and credit cards, your total debts should not be more than 38% of your gross income.

If you have any additional questions about affording a home, give me a call.

Study says home prices are stabilizing

The U.F. Bergstrom Center for Real Estate Studies reported on March 9th that single family home prices have leveled out. They conducted a survey of 318 industry experts, including market analysts, attorneys, financial advisors and industry executives. Wayne Archer, Director of the center is quoted as saying: "If you're thinking of buying a house, there's probably not much to be gained by holding out at this point. It doesn't look like prices are going to fall anymore."

Seems that buyers are agreeing with him. In February 2007, there were 2,387 new contracts in Orange and Seminole County. The lowest dip in the last year was December 2006, with 2,012 contracts.

The average mortgage rate for February 2006 was 5.92% for our area, compared to 6.07% for the same time last year.

Florida's existing home sales in January 2007

The Florida Association of Realtors (FAR) research for January 2007 shows that existing home sales in Florida remained slow in January. The median sales price for single family homes in January 2007 was $239,300. Last January it was $243,200 for a 2% decrease.

Sales of existing condominiums also decreased. 3,007 condos sold statewide, compared to 4,279 in January 2006. Although the prices of condos only decreased 1%, the amount sold decreased by 30%.

Real estate analysts said that as inventories become more balanced over the next several months, we are expected to see some modest price gains.