In September 1972 the Prime Rate , http://en.wikipedia.org/wiki/Prime_rate , was 8- 10% and mortgage rates were hovering around 8-10%.
In 1972-3 Nixon was facing the beginning of the Watergate scandal that would bring the president and the country to its knees. The Vietnam War raged, and global tensions were epitomized by terrorists’ murder of 11 Israeli athletes at the Olympics in Munich. Alabama Gov. George Wallace was shot while campaigning for the presidency. Times were very challenging. I was only 6 , but i do read books.
Fast forward to 2012. Times are once again very challenging and I don’t need a book to tell me that. But when historians and writers look back at the years around 2011-2012, what will they write about?
What will these days be remembered for?
People will look back on 2011-2012 for different reasons than we look back on 1972-3. People will look back on these years for a few reasons. We got Osama Bin Laden, the price of gas, MORTGAGE INTEREST RATES and real estate is selling for a 20% discount. I’m sure there will be other things but lets focus on REAL ESTATE. Why is now the best time to buy?
#1 Inventory high = Prices lower. Market time is growing longer for a sale. Fewer buyers are competing for the available properties. Many foreclosures are hitting the market. These factors are causing downward pressure on prices NOW!.
#2 Real Estate is on sale! Prices across the country are down roughly 15-20% across the board from only a few years ago. This is a sale! Real estate is on sale. That has not happened in my lifetime and who knows if it will ever happen again. Take advantage of a sale on real estate NOW!
#3 Interest rates are LOW. Mortgage rates are at historically low levels, still. Everyone knows this, and people may be used to hearing it. But no one really knows where rates go from here. Take advantage of what we have NOW, take advantage of the lowest rates I have ever seen.
#4 Buyers make the rules. IT’S A BUYERS MARKET. Buyers control many of the aspects of the real estate transaction right now. BUY NOW. Take advantage of the current conditions.
Remember, no one will know when the market has bottomed out and is rising until the bottom has already been hit and we are on the way up. You wont know when the market is at the lowest until we passed it.