Cash is king.
I was reading a great story on CNN  today about a families being able to buy homes at a fraction of the price they sold at a few years ago:
Mary Ann Lepley, her husband, Derrick, and their 2-year-old daughter, Melody, have been in their 3,000 square-foot home here for about three months. They bought it for about $250,000. Just two years ago, amid California’s housing boom, the same house sold for nearly $550,000
I’m glad that they were able to take advantage of the current state of the economy because they deserve it. According to CNN, they were “cautious with their spending and savings in recent years,” as other took out home equity lines of credit and borrowed against their future. Now, with the economy turning, they were able to buy a house at more than 50% off. That’s a wonderful story.
I feel for the other family in the story, the Aceves, who bought their house a few years ago for $620,000. Their neighbors bought their house for $220,000 and a house across the street sold for $267,000. (If you’re wondering about these huge swings, it all depends on how much of a view you have in the case of houses that are on the side of a hill) I’m not saying the Aceves were reckless, far from it (I don’t know their situation), but I think everyone would agree they overpaid.
If you have money because you saved when other spent, it’s now your turn to take advantage of the situation. Your financial prudence has opened up a lot of doors.