Can you get a "deal" now on buying a home in this buyers market? Interesting question, and I've been asked this several times during the past year so I figured I would post a blog about my answer.
On story, when my husband and I bought our first home, it was a foreclosure and it was nearing the end of a buyers market. Prices were definitely in our favor. We fixed up our home over the years, sweat equity as we know it best, and were lucky enough to outgrow it the summer of 05, right before the buyers market began to show some results. At that time, when we closed, we were able to answer the question, "is it a deal?" Because of the timing of our sale, the condition of our property at the time of the sale, and our motives for selling (we were not desperate, just exercised great timing on both the purchase and the selling ends) it WAS a deal that we got.
BUT WHAT IF you buy a home today at a price lower than you would have paid 3 years ago for the home. OR you buy a home in a short sale at a price less than the seller owes. Do you feel you got a deal? Maybe.
I'll take that even further and add to it that your life changes and you end up having to sell in 6-9 months, for equal to or less than what you paid for it. Was it still a deal?
So I'll wrap this up by commenting that perception, life circumstances and market value in relation to timing of purchase and sale are all necessary to look at when answering this question, "Is it a deal?" Factor in the tax credit incentive and add to that a look into the future, if you are able to hold off selling until after 36 months of ownership of this home, and you avoid having to pay due to recapture, did you get a deal then?
I would urge buyers to look at their lives and consider what's important to them right now. What are their needs for the next couple of years and take it one day at a time. Your future will answer that question of "was it a deal?" when the time comes to sell. If you're lucky enough, you'll be able to sell during a seller's market and you'll have some equity in your home.