The Sky is Falling!

Posted by Mike Ciucci on Friday, March 27th, 2009 at 10:58am.

housesfallingWith all the talk about the economy, the weakening dollar, and home values plummeting, you’d think the sky is falling.  Never mind that our local real estate market here in Charleston is on the rise!  Home sales are up for existing homes, as well as new construction in Charleston.  Market activity has increased.  Sales have increased.  I have been very busy lately, and my entire office is excited.  It’s infectious!

So why is now the right time to buy?  Well, for one, interest rates are basically the lowest we’ve seen.  Trust me, THIS WILL NOT LAST.  Interest rates and home values typically operate opposite of one another.  If interest rates are up, home values are down.  If home values are up, interest rates are down.  But for the first time, home values are down and interest rates are down.  Did I mention this will not last?  Discount rates are at their lowest point, around ½ a percent, and basically can’t go any lower.

There are several reasons to purchase your home now: 

First, the low interest rates we are seeing are ready to go up.  Interest rates are directly tied to Treasury Bills (T-bills).  Right now, no one is buying our Treasury Bonds that are at 21/2% (including institutions and other countries such as China, Japan and India).  We are buying our own.  There is too much economic risk for other entities right now, to purchase our T-bills.  In order for others to WANT to buy our T-bills, the interest rate on them has to be increased.  Thus, if the interest rate on T-bills is raised enough for institutions and other countries to want to play, mortgage rates also will rise.  This will happen.

Second, if you’re a first time homebuyer, you get $8,000 back when filing your taxes.  This is an $8000 tax credit, which does not need to be paid back.  To qualify you can’t have owned a home in the last 3 years, the primary residence must be bought this year (up to Dec 1st, ’09), and it can be for a condo, townhouse, or single-family home.

Third, home values are down, and sellers are negotiating.  With so many homes available on the market, the choices seem endless!  Sellers are concerned with the condition of their house now more than ever.  The homes are in tip-top shape.  Sellers are willing to bend (read in: negotiate) on things not considered a few years ago.  Prices have come down.  Low prices and a low interest rate equals less money you’re spending per month.

I don’t want to tell everyone that now is the best time to buy.  I don’t know your individual circumstances such as employment, selling your own home, relocation, etc.  But if it is a good time for you to move, I think now is a great time to take advantage of what this market has to offer!

Image source: exteriorcontractor.com

 

  Mike Ciucci Realtor

Mike Ciucci specializes in the Charleston SC real estate market.  He has been a Charleston realtor for over 15 years, focusing on quality and attention to detail his clients have come to expect.

Mike Ciucci
Carolina One Real Estate

Phone: 843.608.8378
Email: mike@buyingcharlestonrealestate.com

www.BuyingCharlestonRealEstate.com

1 Response to "The Sky is Falling!"

Bobbie Morgan wrote: Your information was very informative. Good to know. Better to use!

Posted on Tuesday, March 31st, 2009 at 9:52am.

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