River City Blog

Buying a new home during a down market could be a smart move! How is this possible?

If you have been considering investing in a new home and you have listened to the news media recently, you are probably not feeling confident about making a move at this time. However, there are some factors to consider. First, a lot of the syndicated stories run by local media report national trends that are heavily influenced by larger, trendier markets. Here in our corner of Southwestern Indiana things aren’t so bad. Oh sure, there are numerous properties on the market. Broad statistics available through the multiple listing service show that we have eight to ten months inventory supply of listings. And, that average days on the market is around ninety days. Homes have been selling for 95-96% of the listed price. House prices have declined some. But we definitely have not been impacted like some of the trendier markets.

Even if house values are down, a savvy homeowner can actually “move up” during this “down market” and come out ahead. Especially when things turn around and prices start going back up.

Here is an example

In a market where house prices have declined by 6% over a given period, a homeowner’s property was worth $125,000 may now only bring around $117,500. However, that same homeowner purchases a home that was worth $175,000 but now only brings around $164,500. In this example the homeowner is better off by $3,000. This probably means a lower amount financed and a lower monthly payment than if they had purchased at the top of the value curve.

If you are considering a move, we can provide you with market data specific to your property. We can show you the current inventory and the number of months supply based on your properties demographic. We also have a unique comparative market analysis program, Price Master. This program allows us to compare features and amenities of a given property with similar properties in the same area that have recently sold. We can then offer an informed opinion as to the range of values a property may fall in. This information is readily available and free. All you have to do is ask.