The market is picking up, no matter what the bubble bloggers are saying! Sometimes, people make decisions that are not based on rational, logical methodology, but on feelings and emotions. People want a place to live that they can call their own. Where they can feel safe and secure from the cold, or wet, or wind, or escape from the world’s problems. There are reasons to buy a home that are not financial and there are people today who are seriously looking to buy a home, even though they think the values may decline some more in the future.
I recommend proceeding with caution, and making sure that the home you buy is one that will meet your needs for the foreseeable future. If there is a high probability of a job transfer in the next few years, (or possibly losing your job) don’t buy now! It’s too expensive to sell and move when you have real time limits, and a flat or declining real estate market.
Today, the market is flooded with “distress sales”. Short sales and foreclosures make up about 45% of the homes that are currently offered for sale in South Orange County. Many of the rest of the homes in South Orange County are either over-priced (unmotivated sellers) for the market, or suffer locational challenges. There are others that are so difficult to show that many agents avoid them – “call 6 different numbers, leave messages, wait for a call back, no showings from 12 – 4 due to napping children, biting dogs live here” etc.
When well-cared for homes come on the market, and are priced reasonably, if they are available to show, they are getting multiple offers quickly. The more desireable properties are actually selling above list price in many cases and within the first few weeks on the market!