Those buying homes should think twice

  • Published
  • By Ronald Lewis
  • 56th Force Support Squadron
LUKE AIR FORCE BASE, Ariz. --  Home prices in Arizona are lower than they have been in years. By some accounts, home prices are halved from prices just a few years ago. Any realtor will tell you now is the time to buy, but is it?

Recent articles on the topic state that no one is certain if home prices have bottomed. Some experts expect another dip in prices. A recent CNN article relays that mortgage regulators, and therefore lending institutions, have tightened standards for mortgages. People who could have easily qualified for a home loan a few years ago are now being told 'No.' Mortgage lenders are looking for higher down payments, higher credit scores (from 580 to 620) and debt payments that do not exceed 45 percent of income versus 55 percent. Missed payments on unsecured debt are looked at more closely, and those who had a home foreclosed upon must now wait seven years versus five years.

Realtors will tell you it's a great time to buy. It's always a great time to buy for realtors; that's how they make their income. Being a realtor is a legitimate business, but you have to decide if you can afford a home and if the decision is right for you.

Military personnel have special considerations when purchasing a home. They are subject to mandatory relocations. Will you be able to sell your home for what it's truly worth or at least the amount you owe if you're told it's time to go? Many military members who bought a home a few years ago are feeling the pain now; they have to move because of official orders and are having a difficult time selling their home for what they owe.

Renting a home is an option, but will you be able to rent it for an amount equal to the mortgage payment? Are you prepared to continue paying the mortgage if it isn't being rented? Remember, you'll have to pay rent or a mortgage at your next duty station too. If you're relying on a civilian spouse's income to cover the mortgage, that income may not continue to be available at your next duty station.

Buying a home may not always be the wisest investment. If you are considering buying a home as a permanent place to live, some of the considerations above may not be so important. However, no one guarantees an investment. There are no government guarantees on investments like there are on savings programs. Investments involve risks.

The Luke housing office and the 56th Force Support Squadron Airman and Family Readiness Center offer a variety of services relating to home ownership. For more information on those and other base services, call the housing office at (623) 856-7643, A&FRC at (623) 856-6550 or go to www.LukeIDS.com.