PROS > CONS
of Buying in Todays Real Estate Market
High Interest Rates
👎CON
The number one reason for people not being ready to purchase a home is undoubtedly "High Interest Rates". With interest rates passing 7% and nearing 8% we can certainly understand the hesitancy to borrow money for so much higher of a price than you were able to just a year ago. In many cases this makes homes that people were looking at a few months ago out of the budget. Clients that qualified for $500,000 mortgages at 3% may now only qualify for a $300,000 mortgage at 7.5% with both of these loans equating to a monthly payment of about $2,100. With all things considered rates of the last 2 years were historically low, and may never be seen again. Although we will likely see a few more increases, we do expect rates to and eventually lower in the second half of 2023 and "normalize" over the next few years, here are some reasons why now may be the right time to buy your next home.
Take note that:
Interest is Tax Deductable *PRO
Refinance when rates come down. "You're marrying the house and dating the mortgage" *PRO
Bidding Wars
👍PRO
Over the past 2 years buyers have been under tremendous pressure to rush to offer on homes they barely got to see. Not only have they had to make quick decisions, more often than not they found themselves in a bidding war with multiple other people who wanted to buy this house. This together with super low inventory drove home prices through the roof! While there is still lower inventory, there are also less buyers, evening the playing field and offering buyers a chance to buy homes at, or below market price.
Negotiations
👍PRO
The days of offering over asking price are dwindling. Sellers are finding themselves back at the negotiating table, and many times lowering the asking price. This finally provides the buyer the ability to be in the drivers seat of negotiations and not completely powerless and feeling as if they overpaid for their home. The Seller may even be willing to pay for closing costs or rate buydowns in some cases.
Contingencies
👍PRO
Gone are the days of offering "AS-IS", waiving inspection, waiving appraisal, and needing to offer CASH. Buying now offers you the ability to take comfort in knowing that your are not stuck in a contract if something major comes up in the inspection and could potentially cost more that you bargained for. Buyers can take comfort in knowing that they are not over paying for a property as the bank will be conducting an appraisal to determine value on the property they are loaning on. If this comes back lower than the contracted price, we can go back to the negotiating table.
Due Diligence
👍PRO
Buying a home in todays market allows you the opportunity to take your time to view a number of homes. Decide what your really like, want, and need. Do your homework before offering, and feel confident in your decision to buy this home. You may fall in love with the first home on the first day, but you do not need to feel pressured into making such a huge life decision right away.
Renting
Use this calculator to find out if renting is a better option.
https://www.nerdwallet.com/mortgages/rent-vs-buy-calculator
We are wagering it's NOT!
Want to Buy now?
If your interested in taking advantage of a great time to buy, with the potential to change your interest rate later, Give us a call!
