HOME BUYERS FAIR : Benefits of Ownership : Renters Must Decide If Now Is the Time to Buy : Housing market: In the ‘90s, tax and savings advantages are still attractive, but the boom times with their quick profits may have cooled.

For those wondering whether the time is right to make the biggest investment of their lives and buy a home, the answer--now as ever--is “probably yes.”

Most financial advisers and economists point out the tax advantages and equity that come with home ownership are worth achieving any time.

But, potential buyers should also have realistic expectations about the housing market of the 1990s. A home will remain a sound long-term investment, but depending on where one lives, the opportunities for a big, quick profit may be diminished, they said.

“It’s not a way of making a fast buck anymore,” said Robert Van Order, chief economist for the Federal Home Loan Mortgage Corp. in Reston, Va.

“This might not be the best time to try to flip a house” or buy one with the goal of selling for a quick profit, said William Zucker, a former business professor at the University of Pennsylvania and a director of the Rodin Group, a real estate investment organization in Philadelphia.

“The 1970s were great. It was less so in the 1980s. In the 1990s, prices will keep up with inflation, maybe not quite,” he said, predicting inflation of 4% to 5%.

Zucker and Van Order indicated that most people can estimate for themselves how much they stand to gain by buying a home, and whether the advantages outweigh renting.

“The cost of trading houses is pretty big,” Van Order said. The realtor’s commission is 6% of the selling price, and other fees and closing costs can add substantial amounts on top of that. Additional costs can include such things as local taxes.

“You have to expect big enough capital gains to make up the costs,” Van Order said.

Another consideration a prospective buyer should weigh, Zucker said, is the demand of a large capital investment--usually a down payment of 20% or more.

Even if house prices do not outpace inflation, the tax advantages of owning a home are generally enough to make the investment worthwhile, Zucker said, noting that mortgage interest and real estate taxes can be deducted from income tax.

As the top income tax rate has decreased in recent years from 70% to 28%, the interest and real estate deductions have decreased in value for some high-income homeowners, but the changes did not affect most people, Van Order said.

Someone weighing the advantages of buying and renting should consider what they will get for their money, said Zucker. A $100,000 mortgage requires about $1,000 a month in payment and taxes, and for that amount of money, a rented dwelling may offer more.

When a market is hot, a homeowner might be able to sell at a profit in a year or less.

In the West, median prices for a single-family home increased 9% to $141,600 in the last quarter of 1989 from $129,900 at the end of 1988, the National Assn. of Realtors said.

“For most people in for the long pull I think real estate is still a good buy,” said Zucker.

And for the rest?

“Rent,” he said.