The housing market's in a state of flux, but you can do well with these tips.

But before you snap up your dream home, consider the risks. We're in a period of economic uncertainty and house prices are expected to keep falling.

It's safer to sit on the sidelines during unstable financial times, but if you want to buy, look for value and, most importantly, make sure you can still afford it when home loan rates go back up.

Falling property prices

The financial crisis is forcing many to sell their homes as they can no longer afford their mortgage repayments. A flood of homes onto the property market and a drop in buyers is pushing prices down. Power is definitely in the hands of the buyer. Sellers are nervous. If you see something you like, put in an offer well below the asking price and you may pick up a bargain. A property is only worth what the market will pay.

Make sure you're financially ready for the commitment of a mortgage. Remember it's much more difficult to get finance these days and many banks require a 20 per cent deposit. Ensure you get pre-approval before you even start looking.

Low interest rates

Interest rate cuts have created an opportunity for many. If you keep your repayments
the same and ignore recent rate cuts, you'll pay off your home loan a lot faster and
save thousands in interest.

Before you buy

Do your sums - can you afford your repayments if interest rates double?

Shop around - find the best home loan interest rates on offer.

Get pre-approval - speak to your lender before you start househunting.

Look for good value - beware of buying in an area where prices are still falling.

Offer less - try 20 per cent below the asking price and negotiate from there.

Get in touch: Do you have a question for any of our experts? Write to Ask the Experts, New Idea, PO Box 1467, Auckland 1140, or send an email to newidea@pacificmags.co.nz.