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It's still the best time to buy a house
A "Sold" sign at a home on July 23, 2009, in Richmond, Calif.
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Steve Chiotakis: The market is awaiting a report on existing home sales for November.
The National Association of Realtors is expected to report numbers better than a year ago. But as Sally Herships reports, even though sales might be picking up, there are still plenty of bargains to be found.
Sally Herships: Jim Gillespie is president of Coldwell Banker, the realty company. He's been in the business for 35 years and he says this is the best time he's ever seen to buy a house for a lot of reasons.
Jim Gillespie: One is interest rates are at an absolutely at an all-time low. You have to go back to the 1940's, World War Two, to find interest rates this low. You've got inventory levels that are elevated.
You've got prices that are way down -- up to 50 percent in areas like Florida, Las Vegas and Southern California.
Gillespie: And then the real kicker is the incentives.
Home buyer tax credits for up to $8,500. But even though this seems like a good time to buy, if you're looking you may still want to wait.
Dean Maki is an economist at Barclays:
Dean Maki: There's one more leg down in housing prices still to go. Not a large move down, but about 5 [percent] to 10 percent.
Maki says there are still a lot of bargain priced foreclosures out there, but by the middle of 2010 they'll have cleared the market. Then, he says, home prices will begin to rise again.
I'm Sally Herships for Marketplace.
Let me ask this hypothetical question:
1) The housing market is being supported by govt tax credits and low interest rates by FED.
2) The interest rates will eventually go up.
3) The individual incomes are stagnant.
So when tax credits are removed and interest rates go up the house prices will again dip. So the current buyers will be underwaer. So what happens then?
