When is it a good time to buy a home?

It seems to me that many people get confused about good timing versus bad. They confuse what is going-on in the general market versus what is going-on in their own lives. When I was an investment officer at a bank in Florida in the 70's, I was amazed to learn that "the little guy" almost always "bought high" and "sold low."

What that meant was when the market was going up and up and up, consumers always were afraid to get in and then just couldn't stand not participating. They waited so long that they always bought at the peak, while the smart money always sells at the peak and buys at the low.

This often is the case in real estate. Think about Wrightsville Beach, NC from 2005 to 2007. Prices went up 5% to 10% per month during peak months. People were jumping all over themselves to get into the action. The wealthy and lucky made tremendous profits (at least on paper) while the late-comers (late 2007 through 2008) bought high. leverages themselves to the ying-yang and many have lost their shirts.

The market in most places, right now, is tepid and prices have declined. That doesn't mean a house that is not for sale will be worth less, but when inventories are high, foreclosures are still in the market and short-sales are still in the papers daily; trying to sell your home is really tough.

BUT, as prices decline and interest rates stay low, affordability goes way up.

So you have to look at your own personal situation: Is your job stable? Do you have enough to make a significant down-payment? Is there pressure to sell quickly?

Depending on these individual answers, it might be a good time to buy -- maybe not sell.

Think about your own situation first, then about the market. You likely will make a good decision.