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According to Zillow.com, last November marked the 53rd consecutive month of decline in home values.  The Zillow Home Value Index has fallen 5.1% a year or 26% since its peak in June, 2006.  This constitutes a greater decline in home values seen since the years of the great Depression.  The housing market could still face additional decline due to excess inventory, high foreclosure rates and weakened demand due to elevated unemployment.

But the news isn’t all bad.  Maybe you have noticed a bit of optimism on the horizon.  The economy seems to be improving.  The improvement is expected to gradually increase consumer confidence. If you have been waiting and wondering when to buy, now is the time to take note. While no one can predict what will happen with the housing market, some experts are reporting that home prices will begin to turn around later this year.  This is based on the belief that the job market will improve half-way through this year.  The unemployment rate just declined to 9%.  And if you believe the stock market leads the way, the DOW is a long way from 7800.

A simple way to view real estate is to assess your needs, wants, and long-term goals.  Do you need a place to live?  Are you planning to stay in your home for several years?  Does owning your own home matter?  Have you saved money for a down payment?  Answering these questions will help direct you. 

If buying a home is right for you, how can you know you are getting the best price?  You can’t. There is absolutely no way to know when the market is at bottom. That is why your needs, wants, and long-term goals are important.  If your need is to live in a home for a lengthy period of time, then home ownership should rank high on your list. If appreciation matters, then buy a sensibly priced home in a good location.  If you choose a home that is in the lower price range, your home will be less vulnerable in a down market and better situated in an up market.