In Part I, Connect2Agent member and Plano TX real estate agent Joseph Cannella shared his thoughts about this new Web 2.0 real estate world. In Part II today, Cannella delves into the current market conditions in Plano Texas and gives some tips to local buyers and sellers in Plano Texas.

Rebecca Levinson: What are the current real estate market conditions in Plano Texas?

Joseph Cannella: It is a buyer’s market in Plano Texas. The real estate market is starting to shift. The inventory is starting to slow down and the interest rates are starting to rise. If you are considering purchasing a house, now is the time to do it.

I was working with a twenty-five-year-old anesthetist a few months ago whose father kept telling her to wait to buy a house and that the rates would go down. She bought a house with me and her mortgage interest rate was at 5% for a 15-year loan. That same loan right now would be at a 6% interest rate.

Waiting can be overrated. Real estate buyers are trying to “day trade” the real estate market. There is a mentality that if they wait then maybe they will be able to get a house at a rock bottom price–not only a rock bottom price, but a house with the same terms–interest rates, buyer concessions, house upgrades–that were available when the real estate listings were higher. 

Real estate is not the same type of investment as the stock market. If you buy now and don’t plan on moving for another 5 to 7 years, you will gain some appreciation in the house and you will have made a sound investment.

RL: Do you ever recommend that a real estate buyer or seller in Plano TX should wait to buy or sell a house?

JC: Sometimes there can be a situation where a person buying or selling a house in Plano TX should wait. Usually this is a financial situation and I will be forthright and let my clients know they should wait. When someone wishes their mortgage payment was 100 dollars less, then they shouldn’t buy the house at that price and are stretching finances to do so. 

Owning a house is not for everyone and we are witnessing that through the amount of foreclosures on the real estate market nationwide today. Two to three years ago, I told my boker that owning a house is not for everyone. When the interest-only loans were popular, I was approached by a mortgage broker with an offer for an interest-only loan. I would have had a mortgage payment of only $1,500 on a $900,000 house. The payments with a regular, moderate-interest loan would have been $5,000 a month. I ended up buying a more modest house and not taking the loan.

The goal for a prospective home buyer should be to live comfortably–to live in their house, not to live for their house. I had a client two months ago who could’ve bought a $1 million house. Their combined income justified the expense, but they were young, still growing into their lifestyle and didn’t yet have any children. They ended up buying a $500,000 house because they could afford the house on one salary. If and when they decided to expand their family, it wouldn’t be a burden on their finances.

If you enjoyed this post, you’ll want to read: 

• Chester County Pennsylvania proves slow and steady wins the real estate race
• Charlotte real estate agent Mona Lisa Matthews wants real estate buyers to beware of national real estate hype
• Connect2Agent puts the spotlight on the Smyrna Georgia real estate market

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Posted by Rebecca D. Levinson

This entry was posted on Thursday, July 24th, 2008 at 6:00 am and is filed under Buyer and Seller Advice. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.