Top 5 Reasons to Buy a Home in 2009

For every realtor that says its time to buy, there is someone calling us opportunists and liars. I understand there is a lot of fear in the market and the economy. However, investment in a home, under the right conditions and if qualified, is still a smart move. What are the right conditions?

1) Ample inventory - you've heard this one before. But why is this important, really? It's simple supply and demand. If one seller is not willing to negotiate , the next one may well be. With far more sellers than buyers, the seller is loathe to let a buyer get away, giving buyers ultimate bargaining power.

2) Low interest rates - Buying an affordable home at a high interest rate cancels out the savings. Buying an affordable home at a low interest rate is the optimum situation, and its where we are now. Having a low interest rate can save you more money over the long run than buying a cheaper home - having both variables in your favor is the best of all worlds.

3) Buy vs. Rent - in the Sarasota metro area, it is now proving to be cheaper, monthly, to buy a home than to rent. Many people cite fear of employment instability in the future as a reason not to buy. However, in either scenario, you have a cash outlay every month. If it is cheaper to pay a mortgage rather than rent - and it buys you equity in a long term investment - it seems the practical way to go.

4) Tax Incentives - The Federal first time home buyer tax incentive is a great reason not to put off your purchase. Complete the transaction on your new home by November 30, 2009 and you are eligible to receive up to $8,000 back as a tax credit. The program is for first time home buyers , or people who have not owned a home in the prior three years. It is retroactive to homes purchased from January 1, 2009 but it does expire soon.

5) Closing Cost Credit - The same Federal program can be used against your closing costs, greatly reducing your out-of-pocket when you purchase a home.