Should you wait for the market bottom?

Buyers: Should you wait for the market bottom? - Buy a House: MLS Listings & Home Buying Tips - MSN Real Estate

5 REASONS TO BUY

1. Prices in the neighborhood you are interested in are relatively stable.
Either they are holding their own or increasing, or the pace of decline is slowing significantly. If you are ready to move or don't like living in your apartment, the small penalty you pay for missing the bottom of the market may not mean much.

2. You plan to stay in the home for more than five years.
If you can stick it out that long before selling, economists say you’ll probably ride out any downturn and come out ahead on price.

3. Your rent rivals a mortgage payment.
If you can qualify with a mortgage lender to buy a house, you can build equity in your house and you can deduct the mortgage-interest on your taxes.

4. You've found the right house in the right area for you.
The schools are great. You love the area and know it would be hard to find another house like the one you have your eye on. In a better market, you would most likely have much more competition for that house and possibly end up paying more money.

5. You've built equity in your house and are moving to a place where homes are cheaper.
In the market you’re moving to your money will go a lot further.

5 REASONS TO WAIT

1. You've lived in your house less than two years.
Chances are you haven't had enough time to accumulate equity in your home. In fact, you may have negative equity, if you live in many areas such as California, Florida, Arizona or Nevada. Also, to take advantage of the Capital Gains tax you will need to live in your home for two years.

2. Your job security is uncertain.
If your company or business is in distress, it's probably better to stay put until the atmosphere improves.

3. You don't plan to stay in your next house at least five years.
While it's not important to buy at the exact bottom of the market, it is important to stay long enough to ride it out completely.

4. You don't have good credit or a decent down payment.
Do you have a job and income you can document? As a result of the sub-prime lending crisis, lenders are much more careful about whom they're making loans to. Be sure to talk to a few mortgage lenders about the different programs they currently have that could work for your situation.

5. You have an existing home to sell in a neighborhood where prices are dropping or where the number of foreclosures is spiking.
In this climate, you're probably better off waiting for your market to improve.

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