Here in beautiful San Diego, it continues to be a buyer’s real estate market. With housing prices significantly down from four to five years ago and mortgage interest rates being historically low, it is a great time to buy.
Real estate is not as complicated as it may seem to be. I know there are all kinds of books, CDs, DVDs, workshops and classes that are available to educate you on buying property. But let me keep it real simple for you. The best advice for you as a property owner or a buyer is to simply buy when prices are low and sell when prices are high. I realize there are many factors that do not make it possible to always follow this rule, but you want to keep this concept in mind and whenever possible stick to it.
Even though property values always go up and down over time, one of the best investments historically throughout the world has always been real estate. So do not be afraid to buy property. If you are currently renting an apartment or a home, you owe it to yourself to consider buying a house or condo. If you already own your home, you should consider buying an investment property, even if it is just a one bedroom condo. It is so important to plan for your financial future, no matter what age you are. Buying property is one of the best investments you can make particularly now housing prices are down and you can buy when they are low. In addition, mortgage interest rates are remarkably low.
Some additional benefits to homeownership are:
Tax benefits – All the interest that you pay on a loan is tax deductable. So each year you can deduct the interest you pay and as a result pay less in income tax. When you rent, you will never see any kind of a return on the money you pay in your monthly rent. Speak to your tax person for additional tax information and benefits.
Payment predictability – As long as you have a fixed rate mortgage, which I recommend, you can anticipate your monthly payments. When you rent, your landlord can increase your rent each year. In fact, an annual rent increase is recommended by property management companies and is a standard in the real estate industry.
Stability – When you own your own home you can plant your roots and stay in one place. I have known many people over the years that have had to move out of their rented home or apartment because the owner was selling, wanted to move back in or some other reason that caused them to take back possession of the property. This is a very disruptive thing that is also costly and very inconvenient to the renter.
Pride in ownership – You can improve your property by landscaping, decorating and doing whatever improvements you want to it without the interference or approval of your landlord. Plus, most renters do not want to put money into a home that is not theirs and therefore, you never make your rented house truly your own.
Feeling of community – Statistically renters move more often than homeowners. So when you own a home there is more of an opportunity to get to know your neighbors and as a result you will have more of a feeling of community. I have lived in the same house as a homeowner for 15 years now and my partner and I have experienced a wonderful feeling of community through the years within our neighborhood.
Once you have property, be careful to protect your equity in it; this is the positive difference between your loan balance and the actual value of your property. Do not refinance and take more money out on your property, unless it is essential. This is how many people have over extended themselves in recent years.
The real estate market in San Diego is different than many other cities throughout the nation, due to the fact that there are a lot of buyers in the market here looking for property. So as a buyer, you are often competing with other buyers when submitting an offer on a property. It is not uncommon to have multiple offers on a listed property. Particularity when the property is priced properly with today’s market and is priced under the $600,000 range. There are many cities throughout the nation that are in a very depressed buyer’s market and even though prices and interest rates are low there are not a lot of buyer’s for the properties.
So remember, it is now a buyer’s market and the best time to buy property. Also, keep in mind that in addition to the low interest rates and housing prices, there are many other advantages to owning property.
Trent St. Louis is a licensed Real Estate Agent
and a member of the National, California and
San Diego Association of Realtors. You can reach Trent at trent@tns.net or at his office in Hillcrest, The Metropolitan Group. DRE#01273643.
