What Changed our Minds?

As some of you may recall, at the end of September, my desire to purchase a home had completely faded. Only three months have passed since that time. So what has changed since that time?

Nationally:

• NBER has finally acknowledged what we all knew to be true; we are in a full blown recession as of Dec 2007. This declaration alone means very little, but I believe it has many psychological and political implications. Now that we are "officially" in a recession, which is already approaching the average length, we can focus on pulling ourselves out, as opposed to debating/denying its existence.
• Americans elected new leadership in November. Obama is a brilliant and articulate man, who seems less bent on blindly following ideology, and more focused on finding the right solution to what ails our nation (I don't want to start a political discussion here, so please limit your comments on this one).
• Interest rates have come down considerably, approximately a full percent (from mid 6s, to mid to low 5s).
  

Locally

• After looking for 2 years, we finally found a home in our price range, meeting most of our criteria, that doesn't need major repairs or renovations (this was a big issue for me, with two young kids, a full time job, and a husband that travels for work...I would much rather continue to rent than spend all my spare time fixing up a home to make it livable).
  
• Sacramento home inventory continues to decline, and sales continue to rise. Of course this doesn't mean prices will stop falling, but it may help with the pace of the decline.

Personally

• As I mentioned in the last post, our daughter will start kindergarten this fall.
  
• Mr. BTs job contract should be good for at least another 9 months and is likely to be renewed. My job, which is closely tied to air transportation infrastructure, will hopefully continue to be funded by the federal government (since it is aligned with the agenda of the federal stimulus).
  
• With relative job security for the next 9 or so months, a job loss will be offset by the reduced daycare payments when our kids start public school (currently an outrageous $1,700 a month for a local center).

I have to be honest, I really didn't think the builder would accept our offer. So this is a very unexpected turn of events. But I am fairly comfortable with it, given the items I outlined above.

Side note: unlike the MSM that often crucifies our political leaders for changing course, I actually admire people who keep an open mind and re-evaluate their position as new information and data comes in. (I'm not talking changing fundamental beliefs, but rather reevaluating the best course of action, i.e. I was pleased that Paulson changed his course on the TARP, from buying bad assets to infusing capital.)