You may be familiar with the Baron de Rothschild’s remark, “Buy when blood is running in the streets”. For years, this remark has served as the guiding light for Wall Street sorcerers and speculators – and it’s no less true in real estate today.
It doesn’t feel especially true, though, does it? Something is different about this particular recession. We’re all aware of it – even those of us too young to remember any others. It’s not hard to imagine that in another time, those of us who’ve kept our heads above water would be rushing out to try and make a profit – but for the most part that simply isn’t happening. If you’re not independently wealthy, have a job, and haven’t fallen behind in car, house, or insurance payments, you probably feel somewhat fortunate – but more than anything you feel cautious. Can you really even dream of buying a house right now?
Actually, yes. No one can foresee the unemployment rate, but chances are good that that’s the only remotely scary variable. Mortgage interest rates and home prices are incredibly low, and discounted properties abound. Dropping numbers of home sales are driving rents through the roof. Whatever else may be happening out there, one thing is for sure: it’s a buyer’s market. The blood is running in the streets.
The amount of money you’ll save by owning your house varies by location, of course. Recently the New York Post featured data from Movoto that estimated that if you buy a 2-bedroom in
, for example, you could save more than $800 per month. That may be an extreme example, but it’s something to think about. Queens, NY
(You don’t even have to buy a new home to profit from the market right now – it’s also a great time to refinance.)
Sure, it’s still a mess out there – and wading into the mire isn’t for everyone, 4.5% interest rates or not. The Washington Post and Fannie Mae report that faith in homeownership as an essential part of the American dream is on the decline, and could stay on the decline for years. But, on the other hand, the old adage has held true for centuries . . . . .