Time to invest....or keep your money in the nest?

This article was orginally posted on MSN....please note the copyright and link to the full article at the bottom!

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"Late last month, Standard & Poor's reported that its S&P/Case-Shiller U.S. National Home Price index of real-estate values increased this past quarter over the first quarter of 2009, the first quarter-on-quarter increase in three years. Its index of 20 major cities also rose for the three months ended June 30 over the three months ended May 31, with only hard-hit Detroit and Las Vegas experiencing declines. The week before that, the National Association of Realtors reported that sales volume of existing homes was up 7.2% in July from June.

In short, the data suggest that real-estate prices hit a bottom some time during the second quarter and have now begun to rise. There's no way to be certain that this marks the end of the long, painful correction that followed the real-estate bubble, but clearly prices are no longer in free fall.

That means if you've been sitting on the fence, it's time to act.

But with real-estate prices nationally now down about 30% from their 2006 peak and showing signs of turning up, the prices aren't likely to go much lower. Every real-estate market is local, and so there may be a few exceptions. Overall, though, I can't imagine a better time to buy than right now.

In addition to bargain prices, buyers should find plenty of homes to choose from. The inventory of unsold homes was 4.09 million units in July, up 7.3% from June, according to the National Association of Realtors. And mortgage rates this week were at a two-month low of close to 5%.

Even the stricter appraisal process is working to the advantage of buyers. Appraisals are coming in far lower than most sellers have been expecting, forcing them to face the new reality of sharply lower prices. And with stricter standards, lenders aren't going to let buyers borrow more than they can afford, which protects buyers and helps to keep prices down.

The flipping days are over

Unless you're really prepared to accept the demands (and headaches) of being a landlord, I don't recommend direct ownership of real estate as an investment. The days of buyers lining up to buy and flip Miami Beach and Las Vegas condos are mercifully gone. There are much easier ways to make money in real estate, such as buying into real-estate investment trusts or buying shares in homebuilders and other housing-related businesses, such as Home Depot (HD, news, msgs).

Historically, the mean rate of return on real estate has been around 3%, according to research from Yale economist Robert Shiller, who co-developed the Case-Shiller index. Shares in REITs and other stocks have often done much better."

(Original article can be found at http://articles.moneycentral.msn.com/Investing/RealEstate/its-time-to-invest-in-real-estate.aspx, all copyright remains with the author and their respective publications. )

My comments: Although I feel like this author has presented some meaningful stats, I COMPLETELY disagree that buyers should not look to RE as an investment right now. There are many of us that still believe we haven't hit "true" bottom, due to the rising unemployment rate/amount of foreclosures to keep coming on the market.

However, learning to manage your properties and run it like a business, rather than "dealing with headaches of being a landlord", as he puts it, can put you very much in the position to create passive income on cash flow properties.

What do you guys think? Great time to buy or go run and hide until the end of 09???

What do you think in your market?