Nobody knows for sure how much longer the housing crisis will drag on.

Here’s what you need to know before you start shopping in the Hermosa Beach Real Estate market:

1) You can’t time the bottom – The fact of the matter is the house you buy will more than likely be worth the same if not less next year. So, you are now thinking, great I’ll wait until next year and time the bottom. Actually, it is much harder to do than you think and the current Hermosa Beach Real Estate market is the best buyers have had in the past two decades. Inventories are plentiful and mortgages are still low.

Just take your time searching, find the place that is right for you and drive a hard bargain. Don’t be shy about throwing in a low ball offer. Your real estate agent can help you determine what would be too low. If the seller decides not to accept the offer, then no harm done other than a bit of paperwork.

2) It’s all about the mortgages, mortgages, mortgages – House inventories are high and will remain high throughout the summer months, but getting good financing will become increasingly more difficult. It is true that the Federal Reserve has slashed interest rates, but fixed mortgages don’t directly follow the Fed. They reflect the bond market’s expectations about inflation, which remains a concern. The 30-year, now at 6.1%, will likely reach mid-6% by December and 7% in 2009. That means there could be a penalty for waiting to buy even if prices fall more. As for variable-rate loans, the spread between conforming ARMs and fixed loans is too narrow to do you much good.

3) You too can get a Jumbo Loan – Mortgages in amounts greater than $417,000 – the limit for buying by federally sponsored mortgage agencies – usually run a fifth of a percentage point above conventional products. But investors are shunning jumbos, which now average 7.2% and are unlikely to drop much this year.

Certain jumbo borrowers could get relief, however. A new law allows Freddie Mac and Fannie Mae to buy loans as large as $729,750 in 71 high-priced areas. So far “jumbo conforming” loans average 6.6%. The program has gotten off to a slow start; you’ll need to shop around. And unless Congress acts, this bargain will disappear at year-end.

4)  Buy near good schools – By now you’ve heard from somebody who knows somebody who got a great deal on a foreclosed property. But when you buy a house, you’re also buying into a neighborhood. And foreclosures tend to be bunched in areas where residents and speculators alike took out exotic mortgages to get into homes they subsequently found they couldn’t afford. That’s not a recipe for stability. Prices and quality of life could both decline further.

Instead, go for areas like Hermosa Beach Real Estate with highly rated schools. They generally fare better during downturns, and that pattern is holding today.