Is it a good idea to go looking for a home in today’s market? It depends on your situation, and here’s why.
It’s a question running through a lot of people’s minds lately: Is now a good time to buy a home? Put simply, the answer is going to change depending on your specific circumstances. However, there are certainly quite a few reasons why now is a great time to jump into the market. Here is what homebuyers should keep in mind:
1. Interest rates: We haven’t had rates this low in nearly 50 years. Essentially, you’re borrowing money at a rate that’s lower than the rate of inflation. Even for cash buyers, it’s a good idea to consider looking into available loan options. You could likely get an interest rate below 3%, though these rates are beginning to climb slightly.
2. Overpaying: The real estate market moves in cycles every seven to nine years. Right now, buyers are basically at the top of a market cycle. It’s unclear exactly when the cycle will change, but prices are still increasing. If you’re planning to buy and then sell in a couple of years, it might be best to wait. Still, it’s important to note that you’re not overpaying—you’re just buying at the top of a market cycle.
3. Your situation: Everyone’s home buying process is different, and it’s important to think about a few key things. If you’re looking to sell your home and find another, you have two different sales to juggle. It’s still a great time to buy, especially if you want to capitalize on your current home’s worth. If you’re a renter, waiting means that you’re missing out on home equity that you could start to build now. For example, if you pay $2,000 per month in rent and decide to wait two years, that’s $48,000 that you could have paid into a mortgage—not to mention the appreciation that could happen in the coming years.
4. New construction: If you’re thinking about buying a new construction home, now’s the time. We have clients on a waitlist for a certain neighborhood—in fact, there are over 80 people waiting to get into it. One of our agents put a new construction home under contract, but the closing date isn’t until 2022. So if you want a new construction home, there’s not much time to wait.
If you have any questions or would like more information about buying or selling homes, feel free to reach out to us. We look forward to hearing from you soon.