Analysts say unemployment makes a bad year to buy a home

An analyst for the home building industry says that 2009 is not a good year to buy for those who may be at risk of finding themselves unemployed. Read more about this report at

"Buyers who lose their jobs or who stay in their homes for less than seven years stand to incur substantial losses as home prices decline further in 2009 and the U.S. experiences more moderate home-price appreciation going forward," says Robert Stevenson, a Fox-Pitt Kelton home-builder analyst.

Another aspect that buyers may overlook is that you don't start to see the return on your home purchase at least until you file your first tax return. Only then does the home interest deduction start to pay dividends, so those first six to nine months as a new home owner can be challenging.Lastly, if you already own a home, you'd better sell or rent that one first before you go try to pick something else up. I've heard of buyers who failed to sell their prior homes for more than 12 months after they closed on their newer home.

At the same time, if buyers are planning to stay in their homes for seven years, and weren't particularly worried about their jobs, there's certainly an opportunity to buy low and hold, with a ridiculously low rate, just as stock pickers are saying about some of the battered-down stocks in the Dow and S&P 500.

One of the things that caused all the foreclosures you are hearing about was the non-traditional mortgages such as interest-only mortgages and option ARMs. But if you can get a 30-year fixed mortgage at a rate of 5% or less, that's probably going to look like a pretty good deal (and inflation hedge) 10 years from now.

Brett Widness is an editor with AOL's real estate channel. Find homes for sale, foreclosures, home values, home finance and apartments at AOL Real Estate.
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