When to Buy

Many buyers in New York City today are said to be "in a holding pattern." They are waiting for that magic moment to buy, when the market has plumeted as far as it will go, and from which point it will only rise. Inevitably, these people end up chasing the market. They wait until they see the market rising before they get on their horse, and by the time they find their home and arrive at the closing table (often a 6-month process), that magic moment is long passed. Bottom line: prices are low, so if you're planning on living in your investment for at least five years, you are almost guaranteed to profit from it. Proof lies in the city's history.

If, however, you're looking for someone to give you a precise prediction as to the ideal time to buy, James J. Cramer of New York Magazine has a prediction as specific as anyone's in his article, "On June 30, 2009, Buy an Apartment." Take everything with a grain of salt, but he has some great arguments. One point to clarify: Cramer says that right now mortgages are expensive relative to their historical benchmark, the 30-year Treasury note. More generally, however, mortgages are cheap now compared to historical averages. Hovering around 5.5% now, mortgage rates create bargains not offered for most of the past decade, when mortgage rates have usually been over 6% and even breaking 8% for most of 2000. Don't let the hype fool you. Conditions are good for financially strong buyers.