Is Now the Time to Buy a Home in Florida

Posted March 25, 2008

     Now is a great time to buy a home, say the financial gurus at the Wall Street Journal.

    The Wall Street Journal on March 11, 2008 said that the real estate market is at or near the bttom and called this a "buyers market." While the advice the Journal offered is sound, you needs to keep several things in mind as you consider buying a home in Florida or anywhere else.

    For most of us, a home is not like a stock market investment.   A home is a place to live; to raise a family or to retire. It may very likely take six or seven years of living in the home to be able to sell it and come out ahead.

    Make sure the home you want is "affordable" on your income.   At last, lenders are returning to the old standby guidelines of wanting home buyers to spend no more than 28% to 30% of their gross monthly income on mortgage payments, property taxes, and home insurance. They also want to see the total of all your recurring monthly payments not exceed more than about 36% of your gross monthly income including things beyond the home cost such as student loans and auto leases. If you are a potential buyer, don't count on stretching beyond these guidelines because reputable lenders won’t approve such a loan any more.

    Have the Upfront Money Needed in the Bank.   Having enough money in the bank to pay your closing costs, which typically are 2% - 3% of the price of the home plus another 5% or more for a down payment is necessary. If you don't have it yet, you're probably not ready to start shopping for a home unless a relative has promised to help you with that cost.

    Location. Location, location.   Reputable Sarasot Realtors know that homes in good neighborhoods within good school districts with low crime rates are much more likely to hold or increase in value over time than other homes.

    Compare before you buy.   Prospective buyers should ask their Realtor to show them the selling prices for comparable homes sold recently in the same neighborhood. You don't want to pay too much for a home.

    Finally, don't fall for the For Sale By Owner (or FSBO) pitch. Many such homes are badly overpriced. That's why the owners ares trying to sell them by themselves. Reputable Realtors will not take a listing where the seller wants much more than the home is worth in today's market.

    In Summary, NOW IS THE RIGHT TIME to start looking for the Florida home of your dreams if you are ready.