Is buying home today a good investment?

Answer depends on whether goals are short- or long-term

Monday, November 05, 2007 Inman News

Up until the recent slowdown, homeowners in many parts of the country saw the value of their homes rise rapidly. Home prices, in many areas, seemed to move in just one direction: up.

A combination of record-low interest rates and rapid price appreciation turned many homeowners into serial refinancers. When interest rates dropped, one mortgage was exchanged for another, sometimes several times within one year.

As home values rose, cash-out refinances allowed homeowners to pull equity out of their homes to remodel, send children to college, take vacations and buy new cars. It was good for the economy while wiping out billions of dollars of homeowner equity.

Tapping into home equity seemed like a great idea until the housing market softened. Now there are millions of homeowners around the country who can’t sell their home for enough to pay off the loans secured against the property.

HOUSE HUNTING TIP: Buying a home is still a good investment if you can afford it, if you are ready to put down roots in a community, and if you want to invest in your personal happiness. Profit potential shouldn’t be your only reason for buying a home, even though in most cases your home will appreciate in value if you maintain it and if you own it long enough.

The housing market, like any economic market, is cyclical. There are periods of robust activity followed by periods of sluggishness. Prices can go down as well as up. Now that the market has softened in most areas, it’s time to look at owning your home as a way to gain control over your personal domain — not as a source of quick cash.

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The quickest path to finding true foreclosure bargains

Following the facts on discounts can help you find the real deals NEW YORK (MarketWatch) —

You’ve heard a lot (probably too much!) about real estate market problems and especially the rapid rise in foreclosures. But as a real estate investor you’re picking up big-time “bargain” signals on your antennae.

The headlines are ominous: some 243,000 foreclosures in August, up 36% from July and 115% from August 2006. There’s blood in the streets.

So how do you get from “there must be bargains out there” to “how much will I save, and where are the best bargains?”

I like to guide any buying decision as much as possible with the facts. But while lots of foreclosures are out there, how good an opportunity they might be was hard to know. Until now.

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A steal of a deal in Oakland!

I am always on the lookout for a great deal in Oakland especially for single women or single mothers.  Why? Because at a certain time in my life I was a single mom wanting to buy my first home and my criteria was that the home had to be in “good” location (aka a safe neighborhood), it had to have 2 bedrooms, space to grow in, a laundry room, good storage, a parking space AND a front or backyard for my child. 

Well…this is what I found today when I went on tour.  Take a look at 2431 Damuth Street in the Diamond District.

This is a 2bd/1ba bungalow that was build in the 40’s.   Vaulted open beam ceilings in the livingroom, hardwood floors throughout, newly remodeled kitchen and bathroom. There is an office in the basement, an incredibly large workshop area. The home is private and very secluded.  If I had the extra cash on hand I would buy this house for my mother!  Below are some pics (basement, storage area, office, artist space and backyard not included):


This bungalow is situated towards the back of the lot.


Walk through an enclosed yard and up the front steps.


Front brick patio just as you enter the gate and go up the front steps. Its very private and secluded.


Nicely remodeled kitchen just off the livingroom. Lots of light and it looks down upon the enclosed backyard.


The kitchen is open and spacious and just to the left is the dining area. The hardwood floors throughout the house are in mint condition.


The remodeled bathroom is quite spacious and roomy enough for two.

Great find. Great price. If you are interested in homes like this one 2bd/1ba under $500K in a great neighborhood simply email me , I’ve got a long running list of homes in the East Bay that make sense for the first time home buyer. 

If you are interested in duplex to help defray your monthly mortgage payments I’ve got a great one located on the same lot.  It’s a side-by-side duplex with one unit rented by a long term tenant that is paying $1,000/mo rent.  The vacant unit is perfect for an owner occupied unit, vaulted ceilings, enclosed brick patio, parking space…a steal of a deal in Oakland at $469K!

1st Time Home Buyers Program with no down payment!

I just spoke to a colleague of mine who works for B of A and she mentioned the following programs that are available.  IF you are interested in finding out more about these special programs just email me.

1st Time Home Buyers


May qualify for a home with NO Down Payment


All Low – Moderate income homebuyers apply!


*  103% Financing available – No Mortgage Insurance       *  Seller credit – OK

*  30 year & 40 year fixed rate loans                                *  Gift money – OK

*  Fico scores NOT applicable in most cases                   *  Other credit OK

*  $1,200. month of undocumented income allowed           *  No reserves required                                                  

Down Payment Assistance Available for qualified buyers

*  City programs offering $15,000.00 – $50,000.00 for Assistance towards your Down Payment

*  MCC – Mortgage Credit Certificate a Federal tax credit  

*  CHDAP – California Housing Down Payment Assistance – 3% of sales price for down payment or closing costs.

What’s happening in Alameda County? Is it a Buyer’s market or a Seller’s market?

We are in a Buyer’s Market.  Do you want proof?  Take a look at the chart below:


A Buyer’s market is when you have more than a 6-month supply of homes. If you focus on the overall trend of the chart above you can determine the number of months’ supply by looking at the data spread sheet. There are of course seasonal trends, which are different in each market. In this example the inventory typically decreases in the winter months, peaks during the summer then repeats itself as we head back into summer. Even though recent sales are strong compared to last year, there are still more homes on the market than homes being sold.


One of my roles as a realtor, homeowner and investor is to educate myself about current and past market conditions to not only help myself in making intelligent decisions but so I can help you determine the best buying strategy for your individual situation.


As you can see by the dark green homes sold bars, based on the last three months, there are less homes selling than last year at this time. This is good news; there are more sellers in your price range. However, we have to compare the number of homes for sale and the pended sales to get a complete picture.

As you can see by the light green homes for sale bars, inventory has started to increase. But unlike last year we have more homes for sale. In fact we have more than six months inventory. This gives you, the buyer, the upper hand.

If you have questions or want to see what properties are a good deal in the East Bay or out-of-state send me an email. 

Top 10 Reasons to Buy a Home

Do you really need a top 10 reason list to convince you that now is the best time to buy a home? One of the resources that I check pretty regularly is the National Association of Home Builders.  I like to know what’s going on and what Building Women are doing. 

Sure you need to financially be in a place where you can ride the ups and downs of owning a home. It’s not easy owning a home or investment property for that matter as there always seems to be something that pops up whether repairs, tenant issues or depleting reserves.  BUT, if you are in a place to buy a home or investment property you should start looking now. 

The best deals in my opinion are always from November through January.  With an inventory in Alameda County of 4,952 homes on the market and only 408 sold I’d say we’re in a Buyer’s market here in the East Bay.  Yes I’ve heard about the bubble bursting and I’ve even been lambasted (more on that later) for saying the sky is not falling. No matter where you look you’ll always hear the naysayers and prophets of doom and gloom where the housing market is concerned. 

Owning property is not for everyone but if we as women listened to all of the negative comments that we are constantly bombarded with whether about our weight, our rights , our intellect, or not being able to break the “glass ceiling” we’d never get anywhere.  So why not look at your purchase intelligently, take into consideration your finances, your goals, your credit, who is on your power team and whether or not you’ll be eating Top Ramen if you make the wrong decision. 

What I can tell you is that if this is the right time for you to buy, below are 10 good reasons why you should start looking now.

10. MORE SPACE: Kids, pets, hobbies, in-laws. No explanation necessary.

9. ENERGY AND RESOUCE EFFICIENCY: Today’s new homes are increasingly energy-efficient and are constructed with resouce conserving materials and techniques to save you money.

8. AMENITIES: Gourmet kitchen, mini-spa bathroom, home theater.  You want it, you got it! It’s all about you.

7. LEVERAGING: Make a downpayment of 10 percent or less of the value of the house.  Earn returns based on the total value of the property.  Plus you get to live there!  What’s not to like?

6. EQUITY: College expenses, consumer goods, retirement.  Your 401k should be so useful.

5. INTEREST RATES: Currently near historic lows.

4. GREAT SELECTION: Ample inventory of new and existing homes means more choices, better bargains.

3. TAX BENEFITS: Your kindly Uncle Sam knows homeownership benefits the nation and encourages it through deductions for mortgage interest and state and local property taxes.

2. MORE FOR YOUR MONEY: Builders are offering free upgrades, mortgage interest buy-downs and a host of other incentives.

1. IT’S A BUYERS MARKET: You’re in the driver’s seat and can get a great deal on a new or existing home.  Yes, dreams do come true.

       IT’S YOUR MOVE.

(reprinted from the NAHB website)