Question No. 1: Is now the time to buy?
Question No. 2: Is buying a house a good investment?
The first answer is easy: With a few exceptions, if you have 20% to put down and good credit, now is a great time to buy. That's been the case all year, and I'd argue that we're probably closer to the end than to the beginning of the really great time. Let me explain.
Back in January home prices had dropped 28% from their peak. More important, interest rates were at historical lows. By locking in a mortgage for 15 or 30 years on a value-priced home, you were getting an incredible deal, even if home prices decreased.
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Instead of a double-dip recession in housing, this week's slew of economics reports are likely to point to a long, slow melt.
WSJ: The financial turmoil in Europe is providing an unexpected windfall for American home buyers, pushing domestic mortgage rates to the lowest levels of the year and back near 50-year lows. Many in the industry now say rates could drift as low as 4.5% this summer from 4.86% now, instead of rising to 6%...