Do you really want to make money?

A year from now I'm going to repost this article. I firmly believe that both prices and interest rates will have risen. 

Low Prices, Low Rates Mean Opportunity

By Ron Lieber, The New York Times, 12/5/08

Housing prices have fallen dramatically all over the country and rates on 30-year fixed-rate mortgages are already close to 5.5 percent. Experts say it's possible, with government encouragement, that rates will fall as low as 4.5 percent.

Now is the time for first-time buyers to step up. Here are some things to consider:

• Prices have always softened in the winter. As temperatures fall, bargain hunters will have bigger then usual opportunities.

• New homes are likely to become scarce. Ian Shepherdson, chief United States economist for the research firm High Frequency Economics, said he believes that a steep drop-off in inventory of new homes is coming soon, thanks to a rapid decrease in home builder activity.

• Location. Location. Location. Buying the best-priced house in a really good neighborhood is still smart.Will values go up? You may have to live in a house for 10 years, but over time, buyers will almost certainly make money.
  

If your grandchildren or children are on the fence about buying their first home, get them off! When interest rates rise, they may find themselves on the wrong side.

Evaluate risks before buying

Good advice from our friend Scott Skinner in Tempe, AZ.

Here are three considerations when evaluating risk before deciding whether or not your next real estate buying opportunity really is as good as it looks.

1) Comfort level - too much stress, fear , and unhappiness, are lingering effects of taking a risk larger than you may want to handle

2) Can you afford a loss - if there is one thing this difficult period in real estate has taught us, is that real estate is not guaranteed to go up forever, ask yourself if you can afford to hold your real estate years and years past what you had hoped.

3) Opportunity cost - deciding not to buy that "good deal" may be the best investment you ever make. Experts will tell you that there are always other buying opportunities. If you have the money in your pocket and the ability to make a decision when it presents itself you may find that opportunity that you could not have take advantage of if you had purchased that deal on which you passed.

Yes, There are a lot of great deals. and yes, we all take risks in life, personally and professionally.

The purchase and finance of a home is a risk that most people take. Historically, it has been very rewarding.

However, be prudent, make sure you do your research, double check your finances, and evaluate your risks.

Thanks, Scott!