July 2008 Archives

July 21, 2008

Buying a House Now is a Good Idea, According to the National Association of Realtors®

I recently came across an entertaining website from the National Association of Realtors® at www.housingmarketfacts.com. I will admit that I was originally drawn to it because I was expecting to find lots of statistics and predictions about market conditions, which I love, in part just because I can reflect, "Wow, there are really that many people looking to buy a house with 8 bathrooms?" or later look back and say, "Were they wrong about that!" And while the NAR has a wealth of statistics and predictions, this site was mostly a gateway to specific parts of the organization's official site, designed specifically for people who are thinking about buying. (It's more entertaining than the regular NAR website, though, since you're welcomed by a Princess Leia-like character... and by that I mean the little hologram projected by R2-D2.)

But not to be distracted. While elsewhere I'm hearing the housing market just took the biggest drop in two decades, the NAR is trying to convince me of the wealth-building value of buying a home. It seems like a tough sell (no pun intended), and it reminded me of something important first-time buyers should consider: when relying on information, consider your source. 

By no means am I saying that the NAR isn't a reputable source. But, as a first-time buyer, you should definitely look deeper before deciding when and where to buy and whether you'll build wealth in the process. One is that markets are very local. Values fluctuate within a county, city, or sometimes block. Another is that markets right now are volatile. Things can change quickly; any national organization compiling statistics can't keep up with the pace.

I agree with the NAR -- over the long term, most houses appreciate and help buyers build wealth. But whether, when, and by how much are all dependent on specifics. You can find the details in your market by checking comparable sales, evaluating sales history and growth, talking to local professionals, and keeping an eye on the amount of inventory in the market and how long it's sitting around.

And if you want a statistic to justify your decision to either buy or wait, jump on the internet. I'm sure you'll find it somewhere.

Alayna Schroeder

July 3, 2008

New Home, New Resolutions to Cut Down on Stuff

I complain sometimes about the lack of storage space in my little house, but I confess, it puts a handy brake on my desires to accumulate. Otherwise, I might end up fitting the profile revealed on MSN.com recently: The average U.S. home has grown from 1,400 square feet in 1970 to 2,300 square feet today.

Meanwhile, average household size has shrunk from 3.1 to 2.5. In 1995, one in 17 U.S. households rented storage space. By 2007, that was up to one in ten, according to the Self Storage Association. The bottom line: Most Americans are buying so much stuff it doesn't even fit into our bloated houses!

I have to say, except for unusual instances (kids want the bed for their first apartment after college, etc.), I often wonder what the point is of paying to tuck possessions away in storage facilities where you never see them. If the possessions aren't worth much, the storage costs will eventually dwarf the costs of replacing them.

If they are worth a lot, they'll be more susceptible to loss in some out-of-the-way storage locker. My neighbor stopped by recently, distraught, because her storage space was broken into and they'd stolen some heirloom china from her mother. The owner basically shrugged his shoulders and said they'd been having problems with break-ins lately.

So if you're about to buy a house, take this as encouragement to have a big garage sale before you go. It's a great way to meet the neighbors, reduce the stuff you have to move, and make sure you fit comfortably into your new digs.