If you are looking for a larger home for your growing family or are interested in purchasing real estate for business purposes, you are probably thinking about making a purchase or two in the upcoming year. This brings to question whether the current economic storm is perfect for real estate investments, or not.

This is an exciting time in the real estate market, but there is also a lot of upheaval, confusion along with the low prices. There will definitely be some changes in the market in 2010, so seriously ponder whether buying real estate now is the right move for you.

On one hand, this is the perfect time to make a purchase since the value and selling price of homes is set to rise in the future. This means you can buy a new home for your family without its value dropping a short while later. This also means you can pick up a cheap rental house and make higher profits in time, or buy cheap prices to flip for substantial profits.

Our job market has not picked up yet and the foreclosure crisis continues to take homes from many American families. It is estimated that about 1 in every 4 homeowners owe more to their mortgage than their home is even worth. You can guarantee that many more homes will be hitting the foreclosure market in the year to come.

Another factor in the foreclosure crisis has been adjustable rate mortgages, which can easily double house payments on families that can barely afford their current payment. In the coming year many of these adjustable loans will reset, forcing yet even more families out of their homes.

This year homeowners had the benefit of a federal program which was announced in November of 2008. This program purchased debt and mortgage backed securities from Fannie Mae and Freddie Mac. But this program is due to expire at the end of March next year. This means that mortgage rates could then see a steep rise. We could then see mortgage rates jump from 4.88 percent to 6 percent by the end of the year.

Some changes being looked at by the Department of Housing and Urban Development are things like increasing the size of down payments required, raising the minimum credit score to qualify or even a possible increase in insurance premiums.

If you decide to purchase a home before the end of June, 2010, you could benefit from up to $8,000 in tax breaks currently being offered by the federal government as a stimulus to the economy. Purchase a second property and you could benefit from an additional tax break up to $6,500. All of this may sound extremely tempting, but make sure you can afford the mortgage payments on the property before taking the government up on these offers.

It is important to keep all of this in mind if you do purchase real estate in the upcoming year, but also be prepared for whatever may happen with the economy. Make sure that you are financially secure and that you can handle whatever changes may be coming in the next year as the economy fits to normalize once again.

Karen Lissack has been writing about real estate and home related subjects for close to 15 years. She will help you with information in any aspect in real estate from buying to selling, even investing. She is fully informed about chapel hill real estate and has helped people find the best chapel hill homes in the market.