All I can say is that there are some deals out there. Buyers are picking up some steals. Prices of condos especially have dropped. If you felt that you missed the market in 2005 or 2006, this is your chance to turn back the clock. The prices of detached homes is off significantly too. Every day I look at the sales reported that day and shake my head. Some great homes in Coquitlam, Port Moody and Port Coquitlam are selling at great prices. More buyers should be looking at the market.

 

Will the market fall further? That is the big question. But should it be? Over the years I've been asked questions such as "Is it a good time to buy"?' or "Is it better to buy in spring or another time of year?".  My answer is always the same: if you have found a home that you like and you can afford it, you should buy it. Period. It's that simple. So is the market going to fall further? Maybe. Does it matter? Think outside the box for a minute. What is the number that most buyers are interested in? It's your mortgage payment, right? Purchase price and downpayment determine your monthly mortgage payment. Most buyers ask, "Can I afford to pay that mortgage payment every month?" So aren't interest rates important too? You bet. Interest rates are the major determining factor in the equation.  At a current rate of 5.45% for a 5 year mortgage each $100,000 borrowed costs $607 per month. Let's say you wait for a market drop of $20,000 on your dream home. Good. Now prices are lower and you buy your dream home for $20,000 less. If interest rates move up 1/2 a percentage point you will have wiped out 20% of any monthly savings realized by waiting for the market to drop. If rates move by a full percentage point you've wiped out 40% of your savings.

 

Another thing to consider is the cyclical nature of real estate pricing. Over time, real estate pricing rises and falls, everyone knows that. In our recent history real estate prices have only risen when looked at over the past 20 to 30 years for example. The overall trend is for prices to increase. This isn't a suprise. Another factor is that when people buy real estate tend to stay in the market for years. So you buy an apartment when you're 25. Over the next 50 years you might buy and sell many homes. In addition, most people that buy and sell tend to be "move up" buyers. These buyers buy a home of greater value than the one they are selling. Did you know that the perfect time to "buy up" is in a down market? It's true. If you are in a home that you would like to sell, and you want to buy a home for $100,000 more, you are in a better position than 6 months ago. Why? The price of your move up house has fallen more in dollar terms than your home. You can buy more house for your $100,000 than you could have 6 months ago.