The weather is beautiful in Palm Springs this time of year.  Unfortunately for me, I didn't have a chance to bring my golf clubs on this trip as it is all business.  This conference is flooded with economists and guest speakers that are passionate about the US real estate market.  The headliners Ben Stein and Christopher Thornberg of Beacon Economics, delivered two complimentary speeches on the state of the economy and housing market in the United States. Here are some thoughts on Ben Stein's views of our country. 

Mr. Stein had some great jokes and a philosophical view of the history of the United States since his birth.  He stated that, "Since 1944 the United States of America has undergone one of the greatest social transformations in the history of the world."  I couldn't agree more.  The racial boundaries in America are gone.  Opportunity abounds for all people in the US.  American's problems are very small compared to what people faced in the 30's and 40's. 

Mr. Stein has bought and sold some 20 houses in his lifetime, and currently owns 10 homes!  He says the IRS / Govt / etc. cannot take away the emotional impact that is felt by owning the home of your dreams.  Life is too short, and being in a home that you love has a tremendous impact on your emotional attitude.  Again, I couldn't agree more. 

Ben, also talked about who the real stars are in America.  Someone once told him that he lived by all of the stars in the world.  From Barbara Streisand to Charlie Sheen.  Ben said, "They are not stars at all.  They are just people like you and I that are making a living.  The real stars in America are the people who put their lives on the line defending our country.  It is the police officers that protect our communities, and the firefighters who keep us safe.  The stars are the teachers who are moulding our future leader's minds."  

I know that we all agree with those comments.  For Americans the future is bright. 

Home prices are one factor in determining your cost of ownership, but so are interest rates and financing availability. Even though interest rates have gone up in the last six months, they are still near historic lows. Since your monthly mortgage payment is a combination of paying down your principal and paying the interest owed, if home prices come down a little further but interest rates up, it could cost you even more to service a mortgage on an identical home!

While a home is a major investment, it is also the center of your personal life. It's important to live in a home that reflects your taste and values, yet is within your financial "comfort zone." To that end, it may be more important to lock in today's relatively low interest rates and low home prices, rather than to hope for a further break in prices in the future.

Please give me a call if I can be of any assistance in determining how much home you can afford in today's market.