People often speculate about when a financial market, any financial market, will reach its lowest point. Some of the greatest analytical minds, economists, analysts and mathematicians wrestle with this problems every day and have been for decades. Surprisingly, very few are able to predict “rock bottom” of any market. A more simplistic thought process is that the bottom occurs when the market “finds support” at a certain price level. You hear that term in the stock market all the time when stocks dip in value.

Real estate interest rates are going lower these days and this means money is cheaper. They may get back near historical lows. In fact, my daughter and her husband bought a home and closed last week at 5.75% on a 30 year fixed rate loan. A lot of people probably wish they had those rates. Well, it may yet be possible for you depending on the loan amount you need, your available equity and your credit score. $417,000 or less is a magic number for real estate loans these days because they are called “conforming” loans. This means if the loans fit certain criteria, Freddie Mac or Fannie Mae will likely step in and buy the loans and help keep the mortgage market liquid.

If you have equity and a loan less than $417,000, or can pay the loan down to that level, you may be able to dramatically lower your house payments. It may be something you want to investigate very soon as interest rates are fickle and could go up quicker than they came down. Call your favorite lender or your professional real estate agent who helped you buy the home, to see if they can help you.

When stock prices go down, I occasionally get a call from my investment advisor who tells me “stock is on sale, but it will go back up”. The same is true of real estate right now. It has taken a beating this last year, but most believe it will go back up since it always has in my memory of 50+ years. If you are buying a home as a primary residence, it may be cheaper for you to buy that rent a home right now when you consider the tax advantages of owning a home. Of course, you should check with an accountant to make sure you are on solid ground in understanding tax consequences. Having a roof over your head is one of the most basic needs so buying a home now, when the market is down, and interest rates are down may be the best thing you can do.

I am not a real estate agent or a mortgage broker. My company is in the information business and provides reports that will help you make better decisions about real estate by understanding value and risk in the local areas. Understanding value and risk are critical elements in any investing scenario, real estate or otherwise and that is what our reports help you do for a house. Would you buy a crude-rich oil field today that could product oil for $25 a barrel when it is selling for almost $87 a barrel, a $62 dollar margin? Sounds good, you think? What if I told you that the oil field was surrounded by hostile rebel forces and had mine fields all around it as well? Would you buy it? Maybe, but the point is, you should always understand both area prices and risks before investing.

This real estate market will bottom out when consumers feel they have the necessary knowledge to make a prudent buying decision and they the time is right. With that, consumer confidence generally rises and we slug our way out of economic woes. The economy is a little volatile but it also presents many people with an opportunity with lower prices and lower interest rates than we’ve seen in many, many years. People who have been on the sidelines are starting to buy in various areas. If you’ve thought about buying, follow the markets closely and don’t miss your chance to get into a home. As I’d mentioned, some of the best minds have failed to pick the bottom of the market and we may be closer to it than you think. Take care not to miss your chance as it may be more attainable than ever before.