It doesn’t matter if we are discussing the stock market, gold, real estate or interest rates.  What goes up, goes down and goes up again… it’s always a cycle.



Recently I posted about why home buyers should purchase a home sooner, rather than later.  While I believe that home prices may remain stagnant (until we experience inflation), it is inevitable that sooner or later interest rates are going to increase.  And once they do, homebuyers are going to be able to afford less home than they can today.

I believe the days of constantly moving and upgrading are over.  I think it is likely that today’s average home buyer will remain in their home for at least ten years. If you are purchasing a home in which to reside, be certain it is one you will happy coming home to.

But what if the homes you can afford are too small or located in neighborhoods where you don’t wish to live?
 
I recently sold a home to a client who I have been working with for years…. many years.  He finally decided to purchase a small home in the Foothill’s community of Tujunga.  He now owns a home and enjoys the tax break owning real estate provides.  But he won’t be living there, it will be a rental. The home was less than $300,000 and he still has enough money for a down payment when and if he finds his dream home. 

The above scenario may not work for all; there could be issues in qualifying for a mortgage, once you find your dream home. But in my client’s instance it worked for him. He is a homeowner; home prices will increase (they always do) he will have purchased an investment property with a shockingly low interest rate and at a bargain basement price.

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