Many people have never owned a home, but still have the desire for homeownership. Each year many are faced with the challenge of wanting to make the plunge but not being able to. There are many things that must be in place in order to purchase a home. Many wonder, will next year be the time to buy a home?

Recent economic changes have brought a slump to the housing market. Home prices have declined tremendously in most areas across the nations. Lenders pulled in the reins and tightened their grip on mortgages. Gone are the easy mortgage days and in are the stricter credit approvals. Let's not forget foreclosures. So many foreclosures have occurred the past couple of years and then, to add to the injury for home buyers, foreclosures were put on hold due to robo signing.

The coming year is faced with a lot of challenges in the real estate market. Many are predicting that housing prices will drop again. Mortgage rates have been going up and down more frequently and no one can accurately predict what next year will bring. Home buyers must need to be aware of these changes.

For those who have the desire to purchase a home, watching what happens with foreclosures and lawsuits is a start. If foreclosures are put on hold, it can very well happen that house prices will increase due to less inventory in the real estate market. Foreclosures are a great way to save money on a home, but home buyers should also explore short sales which can end up being even cheaper. Although the wait for closing on a short sale may be longer, the paperwork is more apt to be accurate since there is an agreement between the owner and the lender.

A very important watchful eye must be kept on mortgage rates. Mortgage rates go up and down according to Treasury yields and mortgage back securities pricing. There is really no telling what is going to happen with this. The past two months have been an up and down, roller coaster ride for mortgage rates. So it is very important to watch and see if a trend is happening. Don't hold out too long for the best mortgage rate or you can come up losing in the end.

It will be interesting to see what happens in the coming year and if it will be a good time to purchase a home. If you are in the market, get your documentation ready now and be ready to take the leap when the time is ripe.