Do You Want a House or Do You Just Want a Deal?

Wish I had a dollar for every question I am getting from buyers asking, "I hear that the housing market is going down more. Why should I buy a house now?"

Thanks for your question, but I have to tell you that you have just asked one of life's unanswerables. No one can tell you if housing prices are going to go up or down in your area during any period of time anymore than they can tell you if a certain stock is going to go up in the next 12 months or if it's going to rain 10 days from now or if their horse is going to win the Derby. If they tell you they can, they're lying. And if I could tell you, I'd be rich beyond my wildest dreams.

People buy houses because they want a nice place to live in a specific location. And they do that on their own personal timetables and when their own financial circumstances are right. The only reason to buy a house is because you want and need a house.

Trying to time the market -- whether its a market for houses, hog futures or gold -- doesn't work in the long run. Someone should buy a house because he wants and needs a house. It's a personal decision.

Keep in mind that all real estate is local. When you see headlines about real estate values, they often factor in places where there had been a huge run up in momentary value such as California and Florida, which rose fast and fell hard. Our region has been comparatively stable.

You have told me that you intend to buy a house. You want an easy commute to your job, proximity to Southern Illinois University at Edwardsville, in a school district with excellent Illinois school report cards, etc. And, because this region is where you want to live, you've asked me to help you find that house.

Here's something that may surprise you given what you hear in the media: Just looking at home sales in Edwardsville, IL for example, the average selling price for existing homes was up by about 12 percent in calendar year 2010 over calendar year 2009. If 2009 turns out to have been the market "bottom," does that mean you're never going to buy a house?

Today, with interest rates near historic low levels, it's your chance to get a lot of house for a lower monthly payment (which is really what you care about if you're going to be in a house over time). For example, if you bought a $250,000 house today at 4.5 percent, you'd pay $1,227 each month. If you waited and the rate went up by one percent while you were waiting, your monthly house payment at 5.5 percent would be $1,419 per month. That costs you more than $18,000 over 10 years and nearly $55,000 over the life of the loan.

Look, my job as your buyer's agent is to make sure you can acquire the house you want for the most favorable terms possible. I will promise to help you do that, if you will promise not to confuse the perfect house with a discount store deal.

Personally, I think you'd be missing out on a lot of great inventory and terrific interest rates if you decided to skip the spring homebuying season in 2011.