Buy now, if you can, economist says

Housing prices may be lower in a few months or a year, but if you can afford to buy a house today with a fixed-rate loan, then do it, a chief economist with Stewart Title said Thursday.

Ted Jones, director of investor relations and chief economist for Stewart Information Service Corp., a mortgage service company, said the advantages of home ownership, such as the tax breaks and increased equity, are more of a benefit.

Some real estate agents call this a buyer's market.

"Prices in Carson City will correct in the next 18-30 months," Jones said to a group of about 75 Realtors, lenders and developers at a seminar in the Plaza Hotel. "Anyone who bought a house 18 months ago is OK, but those people who bought the house with the ugly mortgage and paid the price at the height of the feeding frenzy, those houses are coming on the market and they're not going to get the price they paid for them."

Jones said lenders have approved mortgages that people could not afford. He urged Realtors to do a better job counseling clients. He lambasted the media for worrying home buyers at a time when many are uncertain where prices are going.

The median cost of homes in Carson City has fallen this year. The median cost dropped about 11 percent over the year, from $348,500 to $309,000. Fewer Carson City homes sold in August than a year ago, according to a database for Realtor sales.

The price frenzy started in Carson City in 2002 and peaked in 2005. In 2005, the median cost of a single-family home jumped 34 percent to $348,500. The multiple listing service only lists Realtor sales.

Brent Holderman, president of Stewart Title in Carson City and Douglas County, said the seminar informed those in the local real estate market what to do now that the market has changed.

"I felt he was more realistic about the market or when it might turn," he said.

One local investment consultant said interest rates are good, but many people don't feel the same urgency now to lock themselves into a 30-year mortgage.

Bill Creekbaum, a senior investment management consultant with SmithBarney, said mortgage rates are under 8 percent, which continues to be appealing.

"I'm not hearing that interest rates are going up, or that homes prices are going up," he said in a phone interview. "If I was new to the area I'd be more inclined to consider renting for six to nine months. There's not that urgency to be locking in and buying a house right now."

But those who wait risk the market rising again, he said.

Mike Enright, a Realtor with Valley Realty & Management of Carson City, said he is extending listings, which is something he's hasn't done in about five years.

"We don't believe it's going to get any worse," he said. "Things are going to pick up. There will still be some fluctuation in prices in different neighborhoods, but the old days of putting an emotional price on a home and getting it are over. They (sellers) have to get realistic now and they have."

• Contact reporter Becky Bosshart at bbosshart@nevadaappeal.com or 881-1212.