Hindsight is 20/20. We can look back upon the last several years leading up to the housing market’s implosion and see a few obvious cracks in its foundation. Now is a perfect opportunity to reflect on some of the problems that led to the boom… and bust. If we can identify mistakes, we can avoid making them in the future.

For many buyers, the market is currently chock full of attractively-priced homes for sale. There are bargains everywhere. But the lessons of the recent past are worth remembering as you start searching for candidates. You’ll stand a much better chance of uncovering legitimate deals from among the housing market’s rubble.

Forget Timing The Bottom

A lot of buyers are staying away from the market, hoping that prices continue to drop. They’re essentially trying to time the bottom in order to scoop up a property at a bargain-basement price.

Trying to time a market bottom is foolhardy. Many have tried and most have failed, even with instant access to reams of residential real estate data. Avoid timing the market and instead, look for a home that fits your preferences and lifestyle at a price that meets your budget.

Rely On Your Own Due Diligence

The level of confusion that surrounded many of the purchase transactions leading up to the bust is stunning. People routinely signed contracts and bought homes without having a clear understanding about the terms to which they were agreeing. Invest the time to educate yourself regarding the real estate market and the contracts used when buying a property.

To clarify, working with an experienced agent you can trust is invaluable. They can provide useful price data, information on market conditions, and help negotiate a lower price. However, learn to lean on yourself and do your own due diligence.

A Home Is For Living

Sixty years ago, homeowners had the right idea: buy a home, live in it, and watch it rise in value over decades. Eventually, the property could be sold at a considerable profit, which could be used to fund the homeowner’s retirement. An entirely different paradigm led us into the jaws of the housing debacle. Most people bought their homes with the intent to use it as a stepping stone to a larger house within a few years. This paradigm was built upon an expectation of rapid appreciation.

Real estate experts now agree that such expectations were unrealistic. Many are now encouraging their clients to purchase their homes with the intent to live in them over the long run. Rather than counting on their property’s value to fuel future real estate moves, buyers are encouraged to enjoy a slow increase in value as a secondary benefit.

Avoid A Floating Interest Rate

Few circumstances lead as many people into foreclosure as adjustable interest rates. Many buyers are easily seduced by the low monthly mortgage payments attached to low rates. When rates begin to climb, however, their mortgage payments become difficult to control.

The recent housing bubble was made worse by lenders offering to put buyers into high-priced homes with no down payment. That meant their equity was too sparse – or even nonexistent – to refinance their loans to a fixed rate. Left with few options and a buckling bank account, foreclosure became the only alternative for many homeowners.

The housing market’s recent crash remains fresh enough in our memories to provide useful insight into the mistakes of the past. By reviewing what went wrong, and examining the roles played by individual homeowners, we can avoid making those same mistakes.

There are bargain homes for sale listed in thousands of cities across the nation. But with them comes the temptation to repeat past home-buying blunders. Use the suggestions above to approach the real estate market with reasonable expectations.

Author Bio: Great deals available for Shenandoah Valley Homes and Harrisonburg Va homes for sale

Category: Real Estate
Keywords: housing market, buying a home, homes for sale, choosing a good home for sale