These are the words many of us are hearing in the luxury real estate markets around the country. And while they may be right (they also may be wrong as all markets are hyper-local!), chances are they are making some serious miscalculations especially if they plan to finance the purchase. So here are my thoughts on this statement:
- Asking prices have come down already.
- Sellers are more realistic about pricing AND they are more amenable to negotiation right now: you could negotiate off the price and create an insurance policy for yourself if indeed pricing does come down. If it does not come down, you may have added additional value.
- Interest rates are super-low right now: Locking into a low rate is smart and may have long-term value. If rates come down further you can always refinance.
- Credit is AVAILABLE: if a recession were to come - and pricing is down - you may not be able to get financing. Banks tighten the faucets in tough times and only lend to those with stellar credit and solid, guaranteed income.... and a job. Job losses are a serious concern during recessionary periods.
- Right now you have more choices and less competition. In a tough market, you have to compete against cash bidders and I know few sellers who won't choose a cash deal over a financed one. In a super-strong seller's market, you usually have multiple bids and pricing that go over the ask.
Most importantly the above reasons are ON TOP of the other long list of why buying for the long term is always smart.