[Porsche-O-Phile]

Agree with most (but not all) of the above. There's really no compelling reason to rush right now. There's plenty of inventory, prices are either going to fall more or stay flat (depends on market). This will be an "L" bottom, not a "V" or "U" bottom. The only reason I can think of to rush right in is to lock in a low rate - but honestly that's not good enough of a reason by itself if prices still have 10%-20% (or more) to decline and you're not planning on staying in the house for at least 10-15 years. Do the math over 5 years/10 years/etc. and you'll see that rates would have to move up a LOT in order to offset the cost of buying & selling at a loss (or at "break-even" prices - not counting for inflation effect) in the average 5-7 years a person holds a house these days. The math just doesn't support it (I looked at buying mostly due to other, personal/family considerations but still reached the conclusion that the numbers were still a bit "against"). Then factor in the price of closing costs (which is still very high) and you'll see it's PROBABLY better to wait. Probably. Not definitely though. A way to potentially hedge against this is to consider (as I did) getting an (assumable) FHA loan. You won't be able to rent the property for at least 12 months, but the fact that you'll have an assumable fixed-rate loan at a very low rate might be a very enticing "carrot" to a potential buyer in 5-6 years when interest rates are up around 15%-20% (as I predict they will be, a la 1977). You might be able to sell your house (even at a more expensive price) while your neighbor cannot, because you can "throw in" a 5% fixed-rate loan whereas buying theirs (even at a lower price) might require the buyer to pay 18% (or more, as happened in the 1970s)...

Personally I consider the period about 6-12 months out to be the best "window" (at least in this market) factoring in price, interest rate, difficulty in obtaining financing and ease of selling (if you need to). That's the conclusion I reached about 3 months ago and it's only for this market and only if things continue on the trends they're on. And that's a trade-off. It's based on a lot of assumptions regarding rates and inventory and directions and availability of credit/financing. It could end up being completely wrong, but I think I did reasonable analysis. The things important to you (and the conclusions you reach) might be remarkably different. And even that's not perfect - precisely "timing" a market is pretty much impossible. Point is there are good opportunities now, but there are going to be plenty of good opportunities (perhaps even better ones) for the foreseeable future.

You can always consider the "if I get in trouble, I can rent it out" position too (I did). The rental market for houses is extremely tough right now and even rent prices are crashing. A newly-remodeled house down the street from me (3BR/2BA w/ 3-car garage) was renting for almost $2,800 two years ago. It's currently sitting empty with a sign on it offering it up for rental at $1,600/mo. Still empty after a month with that sign on it. Sign of the times...

RE isn't a terrible inflationary hedge - that's the primary reason I can think of to consider buying. But foreign currencies and commodities might be better ones. Just something to consider...