Buying a home this spring?

We're an Air Force family that will be moving to Tampa, FL this summer, and we're heading down there to buy our first home in about a month. We're definitely buying because of the market, and look forward to buying a nicer home than we could have a few years ago. That being said, we'll still buy less home than we can afford, and plan on holding on to it for about 10 years to help protect us from declining prices. Then we'll hope for the best!

I'm a 23 year old first time home buyer and I'm looking into buying a condo in the Fenway neighborhood of Boston.

Because of the market - I must say I am thrilled at the deals that I am seeing and I am really optimistic about finding the perfect fit for me :)

I was ready to enter the market as a first time home buyer in 2005 but common sense told me it didn't make sense fiscally.

So, I've been renting a great apartment from a landlord who has never raised my rent and said he never will.

In the meantime, I've saved a 30% downpayment and a one year emergency fund while maxing out my 401k.

I definitely won't be buying this year and Spring of 2009 will be the earliest I'll jump in. A lot of people say it's smart to buy now because rates are at an all time low but I think the more money you have to put down, the less the rate matters. Not only that but if the rates go up from here, it only puts more pressure on prices to come down.

I also think (and this is just one man's opinion) that there shouldn't be as much fear about trying to time to the market as there is in the stock market. It's not like prices are going to bottom out and then immediately start appreciating 10% YOY again. There will surely be a good period of stagnant prices.

If sellers are anxious now, they are going be downright desperate come 2009/2010. With less people able to get a mortgage moving forward, the pool of eligible buyers is going to be a whole lot smaller.

Over the next year, you should save your money, improve your credit score and eliminate as much debt as you can. It'll put you in the driver's seat.

I am seeing better deals than the peak of 2005 prices but they still need to come down about 10% from here for me and my fiance to buy.

I just do not think homes will appreciate very much if at all for several years once we hit bottom.

A little Margin of Safety is what we all need.

I am 32 and sold my house in 2006 and have not repurchased. It was clear then that the bubble had peaked, and I was lucky to get out when I did. The profit I made on my house is now sitting in an ING account. Rents are far cheaper currently than owning, so I wait.

I refuse to purchase another house until interests rates go up. The FED is artificially pumping up house prices by keeping the rates low and purchasing Mortgage backed securities. From these unusual measure, it is clear that they see that homes are overpriced and are trying to avoid a collapse. It makes no sense to buy an asset when it is so obviously overvalued.

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I bought my home 2 yrs ago, I got a rate slightly higher than current rates. Current rates have not fallen low enough to refinance. (1 whole percentage point is the general rule of thumb).

I worry about heating my home next winter and commuting costs. I dread if I am forced to sell because I cannot put food in my mouth.

It is a good time to buy for the most part in areas where there are desirable public school systems or other amenities that make an area slightly more stable. Home values shouldn't faulter too much in that scenario.

Everyone who has already bought in the market who would like to swap properties for something smaller, larger, better... are having a huge problem finding a buyer and one who can qualify for appropriate financing. If you gave your current house away for less than what you paid, then trying making up the difference in an "underpriced" home which would be more desirable. It is a crap shoot, that I have not yet attempted. Leapfrogging from house to house is much less of a possibility for people like myself.

I think many wonder what will happen, with higher interest rates, a new president and oil prices over 100.00 per barrel and a virtually worthless U.S $Dollar. (lets not forget our service based economy!!!) I hope we are not headed for Depression. Then everyone will be up a creek ....

I purchased a short sale in February. I sold my condo in the South End in May of '05 and then rented until I purchased this house (actually I am still renting while I fix up the purchased house)

I got lucky and sold at a top point in the market and waited until I found what I liked. I do believe prices have a bit more to drop, but for me it was the right house at the right price for me to purchase now.

I'm in a home and making my payments. I probably slightly over-extended myself but can afford my payments on 1/3 of my monthly income. If I had the money (and could get approved), I'd be shopping for deals right now, though. I'd prolly go low-ball 10 houses that I liked. And, especially if I was renting aka paying someone else's mortgage! It's supply and demand so it's good to buy when everyone else is not. Even if a home purchased today goes down a bit more before the market corrects again, if you wait, you risk the inevitable bidding wars once the media reports the storm has passed.

Don't fall for the "prices are holding up in certain areas" or "prices will not drop much further" excuses by those in the real estate industry. They have been trying to hype up the market for several years with these irrational predictions. Fundamental economics still do not support the current prices. Don't believe it? Then take a look at what is happening locally and nationally. Anyone who continues to believe that prices will not drop significantly further is: (a) working in the real estate industry and has a bias agenda(b) bought within the last several years and is financially overextended with the prospect of not being able to make back money with their overpriced homes they bought.

Greetings:

Right is a good time for someone with good credit and lots of money put down. I brought a house for $378,500 now I'm trying to sale it for $285,000 for short sale before it go to foreclosure. which my house is big with three bedroom and dining room, living room big yard etc. Two family house. nice area which you don't see gang hanging outside. People that going to make money is those with good credit in this market which we are in RECESSION.

You see I brought this house under my girlfriend name I'm taking lost. Right I'm trying to help her sale this house before it go to foreclosure. I gave the lender fair price for two family in my area. If they don't approval it that there problem. I'm trying to help them sale it so that they don't lose lots of money. But they have to understanding there is about 1.5 million people in same situation my girlfriend is..

This is a good time for good people with lots of money not million but enought to put down and buy house for cheap price and wait for about 4 year to updated and maeke profit. I just of buying now but I have to fix my credit. If it was update I would buy now. But believe, next time I will make money. I guess it was not meant for me at this time. Believe me house is going down because we still have lots of people in process lose there house because no good job. Also it take time to go up. What goes down come up.

There are 2 problems with Mr. O'Neil's example cited in Ms. Parks article.
1) He assumes that home valued at $500k and $800k see similar downward price pressures (e.g., 10%). This is not necessarily true.
2) Also, terms like "value" and "worth" are only estimates and frequently reflect emotional sellers. You can say your home is valued at whatever number you choose, but the market dictates its true value. For example, a well priced home (whatever that means) may list for $500k and sell for $490k. However, consider an out of touch seller that prices his/her home at $900k (when the comps dictate something closer to $600k). If the eventual sale is at $600k, can you really state with a straight face that this homes value dropped 33%??

The fact is that home valuations are in a state of flux and have yet to fully sort themselves out. You only realize a gain/loss on the sell and although you may sell for a $50k loss anticipating an $80k gain per the example, this is still a loss at present. And if you know what the near term future holds well enough to convince yourself you realized a gain on the re-purchase, you should probably quit your day job and trade stocks.

Prices still have a long way to drop

We were considering an addition to our current house, but decided to see what we could get if we used the same money in buying a larger house. A house in a good neighborhood opened up at a good price, so we grabbed it. I'll end up spending more with renovations needed on the new property and a little higher mortgage than the addition would have cost, but the location is better and I don't have to get zoning variances or do any structural work. I think it is a great time to move up in housing or buy first time (if you can swing the down and have good credit).

The globe articles were an embarrassment to the paper, whatever your point of view. Short on facts and economic analysis, long on meaningless anecdote. It's the sort of articles that make me despair of the Globe. Just think of the way the New York Times or Wall Street Journal would have written the same article.

As for now being a good time to buy because prices have dropped, that's just silly. If a plane is crashing towards the ground from 35,000 feet, is now a good time to get on because the plane is at 20,000 feet? Obviously not.

Buyers would be well advised to buy once the market stops crashing. A quick survey of real financial analysts will find that no one thinks we are at that point - the optimistic people think prices will drop another 10%, the pessimists think more. And I'm not talking about blog commentators, but the housing banks etc.

And as someone pointed out above, there is no rush for buyers even at the bottom. Housing prices are not going to shoot back up the way they recently did. That was a bubble, and it isn't happening again.

Rather, we'll likely see the normal appreciation rate for real estate, which is to say roughly half a point above inflation. Or, to put that in obvious terms, $2,500 a year on a $500,000 house.

Do you really think you need to rush in to earn that?

Laurie Jensen from the article says:
"Things are pretty crazy: places I don't consider that great are really expensive."

I totally agree with her, I've been looking for houses since 2005 and every play place that I saw in 2005 and today are WAY overpriced. Even in the lousiest, most-crime-ridden, worst-public-school neighborhood, I'm still seeing asking prices of $300+ which would result in a monthly payment that is TWICE what I pay for my "luxury" apartment.

Michael Scott above says:
"It makes no sense to buy an asset when it is so obviously overvalued."

I couldn't agree more. It's been overpriced for years and homeowners are still deluding themselves. It STILL doesn't make sence to buy unless you could talk sellers down AT LEAST 25% off their asking price.

I took the plunge and listed my condo in January of this year. I sold it in March at about $6K more than I thought I'd get for it and $13K less than my listing agent said I should list it as, so I guess it depends who you ask if it was a good price. I was just glad to sell it as the condo market in my area was getting bloated with everyone trying to sell out.

I then turned around and bought a single family house for probably at least $50-80K less than it would have sold for a few years ago.

I still made money on my condo and I bought a house that fits my income and lifestyle so I feel it was a good time for me. And I got a good interest rate on my mortgage.

Home prices will probably slip a bit more. There are deflationary forces that are currently at play, at least until the fed and banks figure out how to jump-start monatery inflation again. Which they will, because inflation is the friend of banks.

That said, we just sold our home in Framingham for near assessment (it was well maintained and in a good neighborhood), and we are moving into Southborough. The timing was required due to age of children and schooling.

Additional moves, required to time the market, would not have paid off due to moving expenses as well as the hassles of moving.

The home we purchased is 10% under 2008 assessment, and about 37% less than the initial asking price. Its a great town, and a great neighborhood. And the timing works out given our family's circumstances.

If the home and location and price is right, its not a bad time to buy that home. But if you have the right place identified, by all means dont feel any pressure to buy the wrong home.

A recent death in the family also is a clear reminder that you only have so many days to time life.

The globe articles were an embarrassment to the paper, whatever your point of view. Short on facts and economic analysis, long on meaningless anecdote.

Couldn't agree more. Headlines ripped from the pages of last year's NAR advertisement: "It's a great time to buy or sell a home." How it could ever be a good time to be on both sides of the same transaction is never explained, which is why a clever Boston.com commenter created a spoof ad headlined, "It's a great time to generate a commission."

Seems to me, the public hasn't even come close to appreciating the full risks of buying now. It's not just the risk of a mild paper loss you can easily ride out. It could be the inability to sell or refinance if the recession takes away your job or requires you to move. Or perhaps worst of all, the de-gentrification of your up-and-coming neighborhood, as coffee shops and bookstores close, restaurants shutter, and crime and decay return. That's something you don't even want to ride out.

Hard to beat the safety of a down payment in the bank.

You need to start at the basic principle; everyone needs a roof over their head. One needs to determine what they want, where they want it (good schools, less crime, location, location, location etc.), and what their budget is to pay for it (1/4 to 1/3 of salary). If you can't afford a nice home in a nice town, then rent. If the home is in a 'transforming' neighborhood, then forget it. If it isn't gentrified and/or safe now, it won't be in the foreseeable future. Don't buy something with an ARM, ever! If you have an opportunity to buy a property from a bank, relocation company, or someone that's all ready moved, don't be scared to put in a lowball offer and see what happens. Scour the web for deals. If you sold in 2005, or never owned a house, and you're waiting for the absolute perfect moment to buy a property, it ain't gonna happen. Sorry, nobody's that good. When there's blood on the streets, buy property. There's a lot of bleeding going on now, so it would be foolish to stay on the sidelines until its gone. By then its too late brother. Good luck!

Well, I'll refrain from addressing the CONSTANT bitterness about overpricing on all these blogs and answer what he's actually asking. Yes, I bought a home this spring. I close in 2 weeks. I enjoyed the articles this weekend because, despite the protestations above, this is EXACTLY what we were doing. We lost approx 30k on our condo (bought in 05) and yet we got a single family house for $115k under asking and, most importantly, we found a house we loved, want to rasie our kids in and will stay in for years - oh, and we can AFFORD IT. Why wait for a recovery in the market to sell and then have to pay more for the upgrade house? Why wait for the "bottom" since you never really know you are at the bottom until it's over, and then what if the dream house is not there to buy.These are not sneakers, they are houses. You look at 100 to find 1 you actually want to live in. When it's the right house, and the math works, you buy!

Real estate is gamble at all times. Know the risk, and play along best you can. If you buy more than you can afford you are stupid, if you think you can time the market you are stupid. Look for value, start small, work your way up. Choose neighborhhods that retain value for stepping stone properties. Be flexible on those properties since it's all about resale and not about your dream home. Start now and by the time the next recession hits you'll be ready to jump on your dream home. I did!

My husband and I just bought our first home. We have been passively following the market for the past 2-3 years and decided this was our time to jump in. Just last summer we wouldn't have been able to afford a house, but with the market and interest rates the way they are now, we wanted to take advantage of it. We will have a great starter home and a mortgage we can afford, so that regardless of what the market does from here, we will be able to sustain ourselves. Trying to time the market is impossible. Also, the market here in the Northeast is by no means identical to anywhere else. If you are in a situation where it makes sense for you to buy, why not now?

I should also add that my house sold in one day. I was stunned but we had three good offers after the first open house. In the end we made everything back that we invested since '02 when we bought - and we did quite a lot of work. I am not sure about all of the doom and gloom. It depends where you are selling or buying. There seem to be a lot of buyers out there, though, and prices do seem to be coming to a point where people will make the purchase. Whether that means bottom??????

I bought my first property in 1994. Sold it for a small profit.

My second property I bought in 1998, sold it in 2002, and profited 70%.

So, with my first two properties, I was lucky - not so with my last sale and purchase. I listed my property at the beginning of the downturn - in August of 2006 - a bloodbath. It took 10 months to sell at 19% off of my asking price. Those buyers got a steal. I still managed to eek out 32% appreciation, but clearly not what had played out before. I bought my current property at 10% less than the seller's original asking price.

Bottom line: you just never know with real estate, as with stocks. I wish I had sold in 2005 and waited until now to buy. Hind sight is always 20/20.

Last month I put a bid on a home that had already fallen from $379 (put on market in May 2007) to $349K in December 2007. The price has not fallen further since and still the home sits.

My husband and I offered the sellers $310K and gave them 6 pages of comps to explain where we came up with that figure. Two days later they responded that they wanted $339K and for us to close in a month (we're in a rental until August and our landlord isn't going to let us off the hook--he's trying to sell too and suspect he has his own financial issues).

We walked because they obviously still hadn't gotten the message--they had a buyer in Summer 07 who got cold feet and walked, and then they had 2 other offers they turned down. The house had been on the market for 10 months. They still turned down our offer--so, either they can't sell at that price (they owe more) or won't. Either way, we can't take on someone else's financial mistake. And we walked....this house may still be there, but then again, there's no shortage of other houses.

I think sellers are still really fantasizing too much about the prices they'll get. With this house, the sale history of the house went something like $199K in 1999, and then the current owners bought the place, needing work, for $347K in 2003. Who in their right mind thinks a house appreciates $150K in 4 years!? In Dorchester!?

I am so, so glad we didn't buy when we got married in September 2005. We'd have lost everything---our downpayment, financial security, everything.

Meanwhile, a week after all this our financing program got cancelled. We can still buy either through another program or hold off until January 2009. We both make over six figures in our household and have credit scores in the 700s. I think we are leaning towards holding off and waiting for people to get real and things to settle.

"So, with my first two properties, I was lucky - not so with my last sale and purchase. I listed my property at the beginning of the downturn - in August of 2006 - a bloodbath. It took 10 months to sell at 19% off of my asking price. Those buyers got a steal. I still managed to eek out 32% appreciation, but clearly not what had played out before. I bought my current property at 10% less than the seller's original asking price."

Beetle Juice, so you bought a house in 2002 and sold it in 2006 and you're complaining that you ONLY got 32% appreciation? That comes out to 8% a year, about double what historical real estate appreciates at. You should be absolutely ecstatic that you got that kind of return.

I also don't get why people put so much stock into amount off asking price. If I had a shack in the woods without plumbing and I listed it at $1,000,000 but I sold it at $500,000, would the buyer be psyched he/she got it for 50% off asking? Most of the asking prices out there right now are unrealistic. You can tell who the realistic sellers are because they price their home using realistic 3-5% YOY appreciation figures that line up with fundamentals.

Also still seems like people are harping on missing the bottom of the market. It's not something to be concerned about. Prices will not all of a sudden skyrocket once we hit bottom. They will be stagnant and increase at about the rate of inflation.

To dgdgfgdg:
If there are a lot of buyers out there then why are we in the midst of the lowest sales figures ever recorded with historically high inventory? Where are all these people who are going to buy a house and who are they? Due to tightening standards many who were able to get a loans several years ago cannot today. Add that to those who will not be able to buy up or down bacause they will be stuck in a home that is now worth less then they purchased.

Sounds like another realtor trying to hype up the market.

If we don't own a property (condo) right now, we would buy. We could handle two mortgages easily until the condo is sold but we are too concern about our job more than the housing prices.

It's kind of funny though: A for sale property is listed at the assessment value! Hello, the assessment was last year and I am buy your house today!

Either way, we can't take on someone else's financial mistake.

Good on you. But the shrinking pool of buyers isn't so smart.

What really amazes me are the small handful fools who step in to rescue sellers who bought during the bubble. A moment online shows you that the seller is asking for a higher price than, say, 2005--and yet will still have to bring money to the table to cover transaction costs and their huge loans.

Yet the occasional greater fool can still be found to step into a loser's shoes and take the drowning man's anchor.

Unbelievable.

That's the amazing thing to me, the lack of hard data that the dowturn-deniers put out.

We hear claims that the real estate recession is over, yet prices are barely, if at all, below 2005. How can the recession be over if it hasn't really started?

Real analysis uses numbers. Like income growth.. Household creation. Credit Cost. Credit availability. Supply. Time on market. Historic data - such as relationship of price to income, and ownership cost to rental cost. And the various deltas.

Anecdote is not analysis.

And while some say this is people whining because they can't afford current prices, I can easily do so, and pay cash. But I've made my money in real estate by buying at the right time, not the wrong time.

And while market timing is not something most should engage in, to say the real estate market is unpredictable is nonsense. I've been predicting it correctly since 1995, and I'm far from the only one (I sold out of most of my properties in summer 2005. Not coincidence).

Accurate prediction simply requires honest looking at ACTUAL data. People who say its unpredictable are simply making excuses for their own ability to do so.

@ Charles, "The globe articles were an embarrassment to the paper, whatever your point of view. Short on facts and economic analysis, long on meaningless anecdote."

I disagree -- the Globe is a fine local paper in which anecdotal stories are the bread and butter. Also, given the financial state of the newspaper industry and the Globe in particular, you can't really blame them for their reliance on RE advertising and a loathing to present the downbeat reality of the market.

More balance would nice, though -- how about an anecdotal article or blog entry on local walk-aways -- you could title it "Defaulting on a home this spring?" Many people have already commented that they've lost money by buying near the market's peak. When declining values pull homeowners underwater, behavior changes, and many will send they keys straight back to the bank -- it sure is an attractive option especially when rentals go for a fraction of mortgage costs, and you can buy again in the future after prices have fallen further and your credit is restored.

How about a local interest article on jingle mail, based on anecdotes if that's what you've got? This sure is an important issue nationally, with FNM and FRE in full disinformation-mode about the consequences of walking away [see tinyurl.com/5bu2c4], Wachovia focused on this problem [see tinyurl.com/57g5vw], and Treasury Secretary Hank Paulson regularly scolding people for making a private business decision. It would be interesting to cover the changing morality and stigma of walking away as well -- in the distant past, default and foreclosure were seen very negatively -- now, it's more-or-less an antiseptic business decision. If the bank lent you too much money for a deflating asset, it's very easy to turn that from an MP into a YP.

Ah har har har har har har you must be joking! Buy a home?!?! This year?!?! How about in ten years after the DE-pression has come and started to wind down.

ANYONE that buys a home these days is a fool and deserves what will happen to them.

Just wait for the entire financial system to crash, it's almost happened and the Feds can't save everyone. Then they'll be giving away homes.

We are looking to buy a new home because we have grown out of our current home, and my husband has a new job and commutes over an hour. Is now the right time to buy? For us, yes.

A home is a LONG term investment. Days of living there for a couple years and flipping it for profit and an unrealistic view of the American dream are over. Buy a house because it meets your life's needs.

Will the market fall further? Yes. Should that mean that you hold off buying? Depends on your circumstances. But, what no one seems to have learned from the bubble burst is that this isn't the stock market. Buy your home to live in it. It will pay off in ten years or more. So what if prices are going to drop, if you take a long term view, your house will appreciate.

For those waiting to time the housing market at it's bottom (or willing that 37% drop), you have a better crystal ball than the PhDs on Wall Street. My view, the same irrational exuberance in the housing market bubble has now turned to irrational cynicism on when to purchase again. It will be a self fulfilling prophecy for a long recession. Control over the economy and the housing market is in the hands of the consumer. Let's stop being arm chair Warren Buffets and listen to his advice – invest in what you know and understand, and live within your means and needs.

@ A.B-G:

Sounds to me like those sellers were waiting for a sucker to come along. Just don't feel bad once someone else buys the place--they probably were the sucker the sellers needed.

Thanks, d-man.

I told my buyer's agent that indeed if someone else was willing to pay more, you wouldn't find me crying about it. Good for the sellers.

Other than having money in the bank and a good credit score the best intangible asset you can bring is not getting your emotions involved. Its a shelter...They are lots of shelters out there... I suspect right now a lot of sellers don't have that luxury.

When we do buy we're going to stay put for 5-10 years. But even with that factor its not a good time. Overpaying is still overpaying. The interest rate is less important to me--as we can see the Fed constantly manipulates it, it could go lower or higher, etc. You can live in a rental--there is no such NEED to buy a house. And if I buy on the way down and then find out in a year or two that could have translated into better space, better neighborhood, etc. if I'd just waited then it DOES make a difference. Moving funds don't grow on trees not to mention closing costs, etc.

As I write I'm watching a lot of neighborhoods like West Newton and South Boston fall into *just* within my range. Either way, its not like prices are going to skyrocket on the way up either.

@ Happy Buyer, "or those waiting to time the housing market at it's bottom (or willing that 37% drop), you have a better crystal ball than the PhDs on Wall Street."

Earth to planet Happy Buyer: it was those Wall Street PhDs that created all those CDOs, MBSs, SIVs, etc. leveraged at 30+:1 ratios based on the assumptions that home prices never fall and underwater home debtors never walk away. That's why Bear Stearns and carlyle Capital went bankrupt. The only reason more major WS banks aren't in bankruptcy is because our friend the Fed accepted all their worthless toxic paper as collateral and gave them huge piles of cash injections. Watch the value of dollar plummet in response to the "crystal ball" of Wall Street PhDs.

Why would I? The market has further to fall. Why catch a falling knife? I'll take my cheap rent and ability able to sock away over 25% of my salary into my retirement and non-retirement investment accounts. When the market bottoms in a few years, maybe I'll pay cash.

@ Sunny Jim

Just my point. If a Wall Street PhD can't figure this out, why could I expect to time the market?

When the market bottoms out, who is to say that interest rates will be at the lows they are today. Don't you remember the 80's? All that loss in the market could be partially offset by the loss you feel on the interest rate. But again, that is speculation and expertise that I don’t have and I’d guess most of us don’t.

I think the same questions apply that they always did:
1) How long will you stay in the home you buy?
2) Can you realistically afford the cost or mortgage, taxes, insurance, and increased homeowners expense on top of your budget?
3) Will you be left with enough savings for emergencies (job loss, illness, etc) after purchase?
4) Can you continue to save money at a rate you feel comfortable with?
5) Are you purchasing primarily for investment purposes or more to have a home?

But, I’ll concur with most of the blogs here, some home prices haven’t even fallen enough (or have risen!) to be of any value. To determine value on the houses we are looking at, we are checking out the last sale and what it went for, then comparing that to the current price. You won’t get real market value on a house purchased in the past 5 years, people are selling underwater and won’t budge much. You also get a better perspective on what to offer. We’ll stay away from foreclosures – probably more cost and effort than is worth the “deal”. Cashing in on someone else’s misfortune probably won’t save me in the end.

If interest rates go up, than prices will fall accordingly. A 1% rise in interest rates must be offset by a 10% decline in prices for mortgage arrying costs to remain equal. Higher interest rates mean lower prices, which means a down payment becomes a larger percentage of the purchase price. And since so many people always site the tax benefits of home ownership (even though paying a dollar to get back 28 cents makes little sense), a higher interest rate means more money going towards interest, which means a bigger write off.

You don't need a PhD to figure this out, you need common sense and a basic understanding of economics.

Happy buyer, I was going to critique your first post, but your second is irrefutably good advice for the average idiot. Yes, that's a slightly mean way of putting it, but I find most people unwilling to educate themselves at all about what is usually the biggest financial transaction in their lives. And I (along with most financial types) tend to view those people as suckers and not have a lot of respect for them.

If you are smart, savvy, and willing to work, you actually can do a lot of the things you say aren't possible. Which is why I've made a lot of money in the stock market the last few years, and a fortune the last 6 months. And I know a lot of other people who have done the same. Granted we are all extremely financially sophisticated, but we got that way through work, not chance.

For the average homeowner, the analysis you put forward in #37 is a good one. In all seriousness. Its dreadfully unsophisticated, but it will stop people who are uninterested in doing the hard work from making really dumb mistakes.

To add another one to the list,

No one should get an ARM, or refinance their house, who cannot instantly articulate Miller/Modigliani or do a discounted present value calculation. Doing things you don't really understand will get you in trouble

Actually, it will be very easy to tell when the real estate market has hit bottom: When everyone you know is telling you how much the value of their home has plunged and anyone who buys is an idiot.

Just like it was very easy to tell when we were in a bubble: When everyone suddenly became real estate investing gurus; people were saying that real estate prices only go up and you have to buy now or you will be priced out of the market; people were camping out to bid on homes; people with $30,000 a year incomes were buying $500,000 homes; etc. etc.