I was just reading an article about the current housing market by Mike Parker.  He eloquently put into words what I have been thinking for a few weeks when he said,

"So, tell your clients the truth: Interest rates will never be this low again in their lifetimes. Home prices won’t be this low again in their lifetimes. This is the perfect storm economically, but it also the perfect time to buy a home; provided that you buy it as a home and not a piggy bank. It’s just a nice side benefit that five years from now, the home you bought today will have appreciated so much that you’ll be thinking (just like I did in 1979): “What a smart investor I am!”

 I'm not saying everyone needs to go out and buy I new house, but if you have been thinking of upgrading there is no time like the present and there might be no time like it again...

Yesterday a 75 Billion dollar home owner bailout was announced.  Full details of the plan and who it will actually help have not been announced but it brings up some good questions and many emotions in a lot of people.  Mostly I have been hearing from people who pay their mortgages, followed sound financial planning and didn't buy more home than they could afford.  It's these people who feel like those being helped by the bailout are the ones that bought more house than they can afford or signed up for high risk loans with variable rates or balloon payments.  According to this article  though this bailout will help many homeowners lower their interest rate. (Full details will be released March 4th).

What is not clear though, is what is to be done with closing cost.  Before you rush in and refi, be sure to look at your options and see if it makes sound financial sense.  For example look at closing cost that are offered to you.  Do you have the cash in hand to pay them or are you going to have to roll them into the loan?  If you need to roll them into your loan, will that make you even more upside down in your house? How many months will it take to break even on closing cost? If you are saving $115 a month, and have $3500 in closing cost it will take 30.4 months to break even before you see savings. Your monthly payment might go down, but you are starting another 30 or 15 year term where most of your payment will be going to interest.  Only time will tell if this bailout helps or hurts our housing market but, always do your research before making any financial decisions...

January Numbers just came out for Home and Condo Sales in Denver and the surrounding areas: Here are some interesting notes and numbers:

Comparing all of Metro Denver Jan 08 to Jan 09 avg of Condos and Homes:

# of closed homes -17%, # of active listings -19%, price of condos and homes sold -14% 

But, there are some bright spots and areas for example:

Denver North West had home sales volume decrease, but avg price for homes increased by 3%

Douglas County Highlands Ranch had a sales volume decrease but averagle days on markets went down by 3% and average home price increased a whopping 13%!

Just shows that it's not all gloom and doom out there like the main stream media would like you to believe. People still need housing in a down market, and those that buy when everyone else is selling stand to make good returns in the future.