Chill In Housing Market Air

Mortgage rates are at their highest in more than two years, and many home owners concerned that the real estate boom may finally be fading seem to have reason to worry, according to Vera Gibbons of Kiplinger's magazine.

"There is evidence of a cooling going on nationwide," she

"What's been happening, specifically, over the past couple of months is you have all these people putting their homes on the market. Investors and individuals alike are testing the market to some degree to see if they can cash out and get out while the going's good. That is pushing inventory up.

"But buyers aren't jumping in feet first, as they were just a couple of months ago. They are taking their sweet time and they can actually afford to take a little more time. There's more of a balance now between the buyers and the sellers that we haven't seen in quite awhile.

"The supply has been growing and the buyers are a little burned out. They've seen prices drop some, and they're waiting for prices to drop further."

Gibbons says the trend is "more pronounced in some areas like the northern Virginia market, and the East Coast and West Coast as well, but nationwide we are seeing a cooling off.

"There's no need for the alarm bells to go off; median prices are just going to come down off very high highs. We're talking about a gain of 12.5 percent that was expected this year to come down to more of about a 5 percent gain in terms of median home price appreciation. So, (there's) more of a leveling off. You have to keep things in perspective here, coming off very high high highs.

"It was always a sellers market; now let's just say there's more of a balance between the buyers and sellers.

"If you are looking to buy, it's still a good time to buy because rates, while they have been edging up, are still low, a little over 6 percent and, if you wait, rates are going to be higher and you could price yourself out of the market. It's a good time to buy now, too, because sellers are getting a little anxious, winter is coming up, it's a very slow season and sellers may we more inclined to give you a better price, certainly better than what was going on in the summertime."

And what if you're on the selling side?

Then, advises Gibbons, "Now would be a good time to spruce your home up a bit, make it look as attractive as possible. Buyers have a lot of options, they are getting pickier, they are taking their time. At this juncture, curb appeal becomes increasingly critical, and you wanna make sure you get the price right. You're probably not going to get the price you wanted for a comparable home six months ago."