NAR ADVISES CONSUMERS TO TAKE ACTION NOW WHILE CONDITIONS ARE FAVORABLE

Remember the stock market bubble days approaching the year 2000? Yes indeed those were interesting times. I had a small basket of wildly fluctuating stocks and a pocket full of "paper wealth". Then came the reality check as the air abruptly escaped the bubble and left many investors holding the proverbial "bag", myself included in many cases. The real winners were the true stock market pros who bought and sold the cycles within the big scheme of Wall Street recognizing the vertical ascent of stocks could not be maintained. They played market volatility, both long and short, profiting handsomely along the way. And one common denominator amongst the real pros was to act with purpose and not succomb to greed. Have an entrance and exit strategy and stick to it. The cyclicle "waves" of Wall Street have a familiar ring within the real estate market. They do exist and the real "pros" will not succomb to the greed factor by trying to time market tops and bottoms of these waves to perfection.

Potential real estate buyers who believe the market has not yet approached the bottom of this down cylical wave should take heed of familiar lessons learned in the past. Large homebuilders are reducing land inventories, developers are shelving projects, "vulture funds" are swooping in to purchase distressed properties from the inventory. The market is seeking equalibrium and will eventually follow historical patterns of the past by slowly beginning the next leg up. Many prices have adjusted to reflect more realistic values and inventories are such that the buyer has a wide range of selection and plenty of negotiating leverage. Interest rates are hovering near historic lows. Builders are offering any number of enticements to lure buyers, from upgrades to closing costs paid and more. Yet buyer sentiment still seems to be one of resistance, waiting for the "perfect" bottom of the cyclical wave.

A lesson learned during the stock market adventures approaching 2000...the pros are there for a reason. Find a good investment advisor, tell them your objectives and heed their advice. The same can be said for our current real estate market. Find a real estate professional, tell them your objectives and heed their advice. A buying opportunity does exist in just about every facet of this market. And buyers should be implementing strategy while this favorable environment exists. Here's an article from the National Association of Realtors addressing the issue...

In a full-page newspaper advertisement running in six of the nation's leading newspapers beginning Nov. 3, the leadership of the National Association of Realtors has launched a national campaign to urge home buyers who have been waiting to buy the home of their dreams to act now before the market changes. NAR's first-ever newspaper blitz features the headline, "It's a great time to buy or sell a home." The advertisement points out that interest rates have fallen seven months in a row and are near 40 year lows, inventories of existing homes are higher than they have been in decades and prices have stabilized. But the perfect conditions for buyers are likely to change as sales pick up, prices gain traction and conditions improve for sellers next year. "Homeownership is a safe, secure way to build long term wealth. The national median price of homes bought 10 years ago has increased 88 percent. The number of U.S. households is expected to increase 15 percent during the next decade, creating a continued high demand for housing," the ad reads. It quotes former Federal Reserve Chairman Alan Greenspan saying, "Most of the negatives in housing are probably behind us. The fourth quarter should be reasonably good, certainly better than the third quarter." The advertisement appeared in the Wall Street Journal and USA Today, the New York Times, Washington Post, Los Angeles Times and Chicago Tribune. It will run in the same newspapers this weekend.

NAR President Thomas M. Stevens of Vienna, Va., said the newspaper ads are the beginning of an NAR campaign to urge buyers and sellers to take advantage of the favorable market conditions. Two new network television and radio ads directed at buyers and sellers will begin airing in second week of January. The new spots will be rotated into NAR's $40 million network Public Awareness Campaign. NAR's 1.3 million members and state and local Realtor associations are being encouraged to adopt the message in their own advertising and communications to consumers, Stevens said. "The market is much better than you might hear or read. Consumers should take advantage of this perfect alignment of low rates and extraordinary inventory before market conditions change," Stevens said.

Total housing inventory levels fell 2.4 percent at the end of September to 3.75 million existing homes available for sale, which represents a 7.3-month supply at the current sales pace, according to NAR's existing-home sales report. The national median existing-home price for all housing types was $220,000 in September, which is 2.2 percent below September 2005, when the median was $225,000. The median is a typical market price where half of the homes sold for more and half sold for less. According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.40 percent in September, down from 6.52 percent in August.