Should you IGNORE The Headlines?
The way to make money is to buy when blood is running in the streets
- JD Rockefeller
I recently came across this article in Time Magazine that summarizes perfectly the current state of the real estate market here in Intown Atlanta. And surprisingly...it has nothing to do with finding steals at 20% below market value, bottoming out prices or agents trying to trick their clients into buying when it's not right for them.
Becoming wealthy has a lot to do with understanding the driving factors of our economy and everything thing to do with timing.
When prices are falling FEW people have the discipline to buy stocks, a house, gold...or any other asset. But those who DO pull the trigger, excel in the long run.
So from this can we assume now is the right time to pull the trigger in the Atlanta market?
Jim Svinth, the chief economist of Lending Tree, thinks so.
You put down 20%and get a 30-ear fixed rate mortgage at today's rate of 5.5%. Monthly principle and interest come to $994.31. Let's say that 12 months from now the same house goes for 10% less, or $197,010. But by then the "recession" is history and the FED is jacking up rates to stem inflation. If mortgage costs rise just half a point, to 6%, your monthly payment would be $994.94 and you'd saved nothing. Meanwhile, home prices might steady and sellers might become less willing to negotiate. And you have spent a year living someplace you'd rather not be.
Buy low, sell high. It's just SMART BUYING...