Why Aren’t You Buying RIGHT NOW? Part 1

Seriously. If you are financially stable, have good credit, and plan to stay in the Charlottesville area for the next four to seven years, at least think about buying.

This comment thread on Real Cville got me to thinking (excepting the used car salesman preface):

DK, make your offer and just buy the house if its the one you want. Paying 5% for 300,000 is roughly the same monthly payment as 7.5% for 200,000. Just be prepared to stay in the hosue (sic) for awhile, maybe even a long while

Simple top-level mortgage math, excluding Taxes and Insurance and including Principal and Interest – (and assuming 100% financing for simplicity’s sake – not something I advise) –

If the house you want today is $300,000, assuming you get a 5% interest rate* –

Now, if rates go up later in the year –

And think about this subsequent comment –

Yes, let’s encourage everyone to wait for the bottom. Not the bottom, but the low, low bottom, in a year or two. This way the companies who maintain nice neighborhoods are out of business, HOA are crap, sidewalks and streets in those neighborhoods fall apart with only banks to maintain them (HA-HA – yeah right…..) and the quality of life in Charlottesville will have gone way, way down for all.

Charlottesville IS unique in that there are 3 industries that will survive this mini-depression. We have: Education, Health, and Government jobs. All statistics show those industries will be the least affected. Yes, they will decline or freezes in employment will take place, however, our town will never completely collapse, like others in our country will.

Do I think there are too many fingers in the real estate pie? Absolutely. Do I think there has been too much development? Absolutely. Do I think the banks are as much at fault as builders or developers? Yes. Do I think there has been false information and false hopes for the future spewed by so-called “professionals”? Absolutely.

But, do I think our town can save itself in some way, yes, I do. People need to wake up and smell our world’s new reality. I think people in C’Ville are in major denial that it’s happened here….

I’m not saying that everyone should buy, nor that everyone should seriously consider buying … but at least allow the thought to enter the conversation for a minute or two. The fear in this market is very real, palpable and often justified. But fear should not guide one’s life.

Part 2, coming Tuesday, will look at the results of last week’s poll.