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  #25  
Old 02-18-2011, 09:29 AM
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Re: I might do the unthinkable.

Buy the house. Your kid needs a backyard with a swingset more than you need a new Jeep.

Home prices are at great levels right now. The 30 year interest rate is starting to creep up right now, so IF you do wait, you'll be spending more for your home. (new cars ALWAYS have some sort of incentives to get you to purchase regardless of the economy)

Oh, and get a dog to go along with that new house, swingset and kid.
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  #26  
Old 02-18-2011, 10:00 AM
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Re: I might do the unthinkable.

btw, if someone hasn't mentioned it yet, your $250 deposit is fully refundable. Good luck.
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Old 02-18-2011, 10:03 AM
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Re: I might do the unthinkable.

Keep in mind that there is no urgency to buy a new home...home prices are going to remain stagnant for years..... If a real estate agent tries to push a transaction sooner then later...beware, do your homework...there is no rush.

With car prices, they still run a predictable path....home prices right now aren't. They are probably declining in your area of IL and will be stagnant for some time along with IL raising taxes overall (including probably on home owners since they are stuck).

Just be cautious and prudent when buying and selling a home in this economic era.

I have a lot of experience in real estate even though that is my main thing and have made a lot of money in real estate by making VERY careful, prudent decisions regarding land development in the midwest. I also know of people who have lost a ton of money (millions) in real estate in the last few years and some went BK or are about to soon. The stress of being stuck with declining real estate is terrible since you are completely helpless and have to shell out more money each month...the stress some these people are in have taken them to the brink....

So, just sayin', take your time and make a careful decision regarding a new home in this economic era.
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  #28  
Old 02-18-2011, 10:03 AM
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Re: I might do the unthinkable.

I see all this talk about buying a house but I don't think that's the best move for you right now. There are a lot of advantages to a townhouse in the early stages of building a family. For the next 2 or 3 years your life will revolve around the newborn, you don't need to be worrying about lawn care, general maintenance, shoveling the drive in the winter and everything else that's probably done for you as part of your association fees. You also don't know where you'll be by the time you new child is ready to start school or what new priorities you will have as a new father.

Although real estate prices are at historic lows the fact you already own means the value of your town house should track the rest of the market. If the market goes up for that new house you want the value of you town house should track up as well keeping the difference between the two pretty much that same. If you were renting then that would be a different story but you aren't so my advice would be to stay put. You have 4 years or so to make the final decision on which neighborhood you want to raise your family in, don't rush into something now that you might regret.
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Old 02-18-2011, 10:19 AM
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Re: I might do the unthinkable.

Quote:
Originally Posted by mjw930 View Post
Although real estate prices are at historic lows...
Not really in real dollar terms following the long term home price trend line. We're still above in many areas with a further 5%-10% decline to return to trend line not out of the question. Realistically, these things should dip below the trend line before hitting their lows.

Home prices are also being propped up by artificially low interest rates engineered by the Fed and of course nearly all new mortgages are being bought up by the Fed Govt. and backed by them. Once interest rates are no longer being manipulated, they will rise and thus home prices will need to fall further to match the monthly affordable payments under higher interest rates (6%-7%+) since most people buy homes via financing versus outright cash purchases. Moreover, a return to the 20% down is happening and will continue to be entrenched as the Fed Govt exits its involvement and the banks return to originate and hold and any mortgage investors require more skin in the game...resulting in even fewer buyers and more downward price pressures. Add higher home ownership costs (taxes) and home prices will have to further decline to remain affordable on a monthly payment basis. Selective inflation that doesn't included home prices will also put downward price pressures on home prices.

The bottom line in real estate is that you make your money (or lose the least amount as the case my be) at the time you buy it, not when you sell it.
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