Signs the Market Is Changing - Know When It's Time to Buy!

Lots of potential buyers are out there waiting for the market to "bottom out" - but there really isn't a magic formula, nor will there be news articles that are timely enough for most buyers to take advantage. There are some signs you can watch for and information you can track to identify a turn in the market.

First things first, don't pay attention to the national news! It seems that fear is rampant and fueled by negative press. This tends to keep buyers on the back burner and often times they will miss a great opportunity because of negative press that may not even be relevant to their area of interest!

Next, be ready to buy when you see the home you want! The chance may not come around again so soon!

The signs we, as realtors, look for that a market is turning are:

The number of active listings start to decline. The best homes in the best conditions are selling! And keep in mind that the most desirable homes will leave the market first.

The number of days on market starts going down. This certainly marks a turn in the market, and in a seller's market the prices are going up and the number of choices are going down! At the very least, sellers will stop dropping the prices.

Sold homes go for closer to the listing price. In 2007, home prices dipped for the first time in four decades. With a 1.9 percent decline, homes still sold within 97 percent of listing price. When they get to 98 percent, you need to be ready.

Prices remain firm or rise. Prices are a product of demand. To attract buyers, sellers reduce their prices and offer more incentives. If homes are selling reasonably well, prices won't move downward -- they'll go up.

Incentives disappear. When a market begins to favor sellers, they don't have to do as much to sell homes. Watch new homes and see if builders are still giving away upgrades such as granite kitchens, hardwood floors and closing assistance. If they aren't, times have changed.

You can track many of these numbers yourself. For instance, once a month, at www.gcaar.com (the Greater Capital Area Association of Realtors) publishes all of the statistics for the areas around Washington DC (Maryland & Northern Virginia as well as DC) - this is available to the public at their site. For those of you out of this area, a call to a local real estate office will get you the local association or just google it. Most all area associations make information available to the public. Each month you will see the month over month statistics for number of listings, number of sales, days on market, etc., all the same information we, as realtors, rely on.

Remember, any change in condition will change others, so again -- be ready. Now's the time to buy a better house while prices are low, interest rates are low and inventory is still high.

BE PREPARED and CHECK BACK HERE OFTEN!