Fear of overpaying for property is common these days, especially in places like New York where prices continue to be unstable.

If you encounter potential buyers who are frozen because they are concerned that they will pay too much, here are some factors to point out:

• Waiting for the right time can be expensive. Some buyers would have more equity today, despite falling prices, if they had bought when they were first considering it, instead of continuing to pay rent.
• Financing is fickle. Some people who were highly qualified last year can’t find financing this year because the credit market has tightened or their personal financial situation now makes them an undesirable borrower.
• Interest rates are headed up. If prices decline by another 10 percent, but interest rates increase by 1 percentage point, the monthly payment will be the same.
  
  Source: The Wall Street Journal, Douglas Heddings (07/27/2009)