When is the

best time to buy a home?

If you are

a first-time home buyer, or if you are thinking about trading up, downsizing

or buying a vacation home, the planets have aligned and it's time to act.

Several factors,

from low mortgage rates to new financing options, combine to make 2001

one of the most advantageous periods in years to buy a home, according

to the National Association of Home Builders.

Let's start

with market conditions. You can get a jump on the 2001 selling season

The inventory

of new homes has edged up over the past few months and consumer confidence

has trended down, which translates into more opportunities for home buyers

who act now.

Next, let's

look at the numbers. In the wake of the Federal Reserve Board's recent

decision to cut short-term interest rates, you have an historic opportunity

to lock in a low fixed rate on a mortgage. Buyers with good credit can

expect to shop for a loan in the low seven percent range.

With lower

interest rates, you can afford a more expensive home without increasing

your monthly mortgage payment, and renters may get their first opportunity

to enter the market and become home owners.

The federal

government gave an additional boost to first-time home buyers this year

premiums on FHA-insured mortgages.

The higher

ceiling, which raised limits ranging from $86,317 to $170,362 up to $132,000

to $239,250, will enable thousands of buyers to take advantage of these

low down payment loans.

Mortgage insurance

is a required expense for many home buyers who can't afford a 20-percent

down payment. And new legal provisions for both FHA-insured loans and

privately insured loans mean that you can cancel this insurance once your

equity reaches a prescribed threshold, rather than paying the premiums

for the life of your mortgage.

For first-time

homebuyers concerned about being able to save enough money for a down

payment traditionally 20 percent of the mortgage there are many new options.

You can withdraw

up to $10,000 from an individual retirement account (IRA) without penalty

for use as a down payment. Or, take advantage of new mortgage options

that allow you to put ten percent, three percent or even no money down.

If you're self-employed, lenders are working to reduce the additional

paperwork typically required.

Talk to potential

lenders about making these new financing options work for you.

Buy a new home

now and you'll be glad you did come time to pay your 2001 taxes. The tax

advantages of owning a home are many.

First of all,

home buyers can usually deduct loan points and origination fees for their

mortgage, regardless of whether the buyer or the seller paid them. Since

origination fees typically run one percent of the mortgage amount or higher,

this can amount to huge savings.

In addition,

mortgage interest is deductible, and still one of the greatest ways to

reduce your tax burden.

For example,

if you pay taxes in the 28-percent bracket, this provision may lower your

borrowing costs by nearly one-third, depending on state taxes. In fact,

you may be surprised to find how favorably owning a home compares to the

cost of renting.

It's certainly

a great time to buy a new house. New home construction is better than

ever, offering the latest in energy-saving technology, efficient heating

and cooling systems, innovative design and a host of exciting new features,

from pre-wired high-speed data lines to high-tech lighting and security

systems. Plus, the decisions you make on layout, colors, materials and

appliances will make your new home a true reflection of your individual

tastes and preferences.

Remember home

equity accounts for approximately half of the total net wealth of the

typical home owning family, making homeownership the primary source of

a household's net worth and the fundamental first step toward accumulating

personal wealth.

About 900,000

new homes will be sold in 2001, according to NAHB. Will one of them be

yours?

John Hayes,

who is with Torrey Homes, is president of the Home Builders Association

of Midwest Georgia, which serves a membership of approximately 460 builders

and associate members in Fayette, Coweta, Spalding, Heard and Meriwether

counties.