If you’re wondering whether or not this is a good time to buy a house, here are four considerations to help you decide.
1) Is your income secure so that you’re not concerned about being laid off after your purchase closes?
2) What is the trend for real estate values in the County where you live? It is very different from one state or region of the U.S. to another.. You can go to zillow.com and type in an address (or select an address from the listings in the city you search), then look at the Market Value page.
Notice that this first one I searched shows the value trending downward. It also showed that the seller recently reduced the price from its original listed price..
But this second home I searched shows the value still going up.
Very interesting, right?
3) You might consider a 2/1 Buydown. That is a loan where the seller can give you a credit to buy down the interest rate. It is lower by 2% the first year, then by 1% the second year, then goes to the full interest rate. The idea is that in two years, the rates will be better and then you can refinance. BUT, will the rates actually be lower in two years? No one knows for sure. In some areas of the country, this is a very popular loan and the sellers are paying for the buy down fee; but in other areas of the country, the sellers are not, so then it’s too expensive to be of value for most buyers. You will need to discuss this with your local mortgage broker for what’s happening in your area.
4) Even though interest rates are higher than last year, the home prices are lower in many parts of the country; therefore, with a lower purchase price and smaller loan, your payment might not be much higher than it would have been last year. But again, that depends on where you are buying.
I hope these four considerations have given you something to explore for your area, and then you can make a good choice for yourself.
Personally, I am a huge fan of home ownership; but I am also a fan of buying a home you can afford so that you don’t become a slave to your mortgage. If you can find a property you will like to keep for at least five years, then it usually makes sense to purchase and begin to accumulate equity and grow your real estate wealth. Especially if your rent is as high or almost as high as your home loan will be.
What’s Coming Up
I am putting the finishing touches on a new book for homebuyers. The cover is still with the design department. All the information in it is brand new and current for 2023. Subscribe to this blog to receive a notification when it is released. (January)
