Realty Scribes Favor Buying a Home Now
The public didn’t really ask for their opinions about the current state of housing, but a garrulous group of realty media writers from throughout the nation offer some editorial opinions on the subject.
Initially, they echo the real estate industry’s favorite slogan--buy now!--because interest rates are stable and at their lowest point in seven years. They even talk about some bargains in housing, but not, of course, in California.
They were participants in a survey conducted for the National Assn. of Real Estate Editors and they cover realty news in 40 major housing markets.
A composite summation of their choices of where to live reflects these preferences:
‘Sense of Neighborhood’
A location which is a convenient commute to places of employment and recreation, a place which has “a sense of neighborhood” and a low-maintenance lot with fee simple ownership. Eighty-three percent of the respondents believe that now is a good time to buy a house. Slightly more advised buying an existing home rather than a new one, while nearly half of those polled said that resales and new houses are equally good buys for 1986.
Conducted by the Greenman Group Inc., Hollywood, Fla., the survey asked association members whether they would buy a home in their market today, what kind of mortgage they would choose and whether they would select a house in the center city, a close-in suburb or an outlying suburb.
The 83% who think now is a prime time to buy, cited low interest rates and bargain prices due to heavy inventories in many markets. Of those who said they would buy now, 30% prefered a resale in a relatively close-in community.
On the other hand, 22% said they would pick a new house to take advantage of more rapid appreciation, attractive financing packages, modern design and energy-saving options.
Make Same Choice
Of the responding editors and writers, 50% live in a close-in suburb, 33% in farther out communities and 17% in central city locations. Almost all said they would make the same choice today, including this respondent who lives six miles northwest of The Times, paying on a fixed-rate mortgage.
“With an inventory of some 20,000 unsold homes, metro Denver has some outstanding bargains,” said James M. Woodard, Littleton, Colo.-based syndicated writer. “The best buys are single-family resales.”
Eli Adams, managing editor of Professional Builder magazine, Des Plaines, Ill., said that the Chicago area, where the magazine is based, has property values that are “high and will remain that way.”
Adjustable rate mortgages won approval from 37% of the respondents, while 63% voted for the predictability of fixed-rate loans.
“I’d take an adjustable with caps (on the interest rate) because lenders have really dropped rates on adjustable rate mortgages to boast loan volume,” said Wayne Markham, home and design editor of the Miami Herald.
Better Deal for Lender
“I’m a conservative,” said Robert Brennan, former real estate editor of the defunct Cleveland Press and editor of the association’s newsletter. “I believe mortgages, particularly today’s now-you-see-it, now-you-don’t kinds, are a better deal for the lender than they ever will be for the borrower.”
Syndicated columnist Lew Sichelman, former real estate editor for the defunct Washington (D. C.) Star, said that he chose a fixed-rate mortgage for his house in Bowie, Md., in 1976 before adjustable loans became popular.
“Today, I’d line the choices up side by side and give each one a hard look,” he said. “In my price range, I’d probably opt for an adjustable rate mortgage as long as the initial rate was at least 3% below fixed rates and the loan carried yearly and life-of-the-loan payment and/or interest rate ceilings.”
Jerry Johnson of the Sacramento Bee believes current interest rates under 12% are “as close to single digits as we’ll ever see” and he adds:
“Unless something meaningful is done toward reducing the federal budget, which appears unlikely, rates over the long haul can only move ‘north.’ Our nation is mortgaged . . . at an adjustable rate, unfortunately.”
