If it is a Buyer's Market, Why Aren't They Buying?

Everyone keeps saying that it is a buyer's market. And, it sure looks like one. There is a lot of inventory on the market, sellers are dropping their prices, and good loans are still available. Well, someone better tell the buyers that it is a buyer's market, because a lot of them are still holding back.

Why are buyers being so reticent in this market that appears to be working in their favor? After years of multiple bid offer situations and paying astronomical prices for modest homes, one would think that buyers would be jumping at the chance to get some of the deals that are out there now. I have a few ideas.

Buyers are unsure about the mortgage market. A lot of people still think that good mortgages are not available, but the mortgage market has come back after a brief period of crisis. Sure, the crazy sub-prime loans to people with questionable credit may not be available. But, if you are a solid buyer with good credit, there are plenty of attractive loans available.

Buyers are unsure about the long-term value of a home purchase. Real estate is almost always a good long-term investment. If you are looking at a quick flip investment, right now might not be the best time, especially for amateurs. But, if you are planning on being in your home at least 5 to 10 years, you shouldn't be worrying too much about value.

Buyers are worried that prices will go down. There is a fear among buyers that they might be getting a good deal, but that if they hold out they might get an even better deal. But, if you find a home that you love and you are willing to make a deal on it, that is the right value for you. And, if you can get a good loan and plan on staying in the home for 5 to 10 years, you have nothing to worry about. Plus, if you wait, you might miss out on the home of your dreams.

The real estate market is a living breathing animal that changes all the time. If you have questions about the market, please let me know. I am always happy to help. I can be reached at 510-547-5970 x57 or MSmartt@jps.net.