Here in sunny Southern California spring has definitely arrived. The flowers are blooming, the grass is starting to look shaggy and in need of mowing, and it’s the perfect time of year to go shopping for a new home. What makes this spring the right time to go house shopping? Consider these four excellent reasons to go house shopping soon:
1. Prices Are Only Going to Go Up
Housing prices have been steadily rising for quite some time, in fact from Jan 2018 through Jan 2019 the average increase in prices was approximately 4.4%. In a report issued by CoreLogic, prices are expected to increase by 4.6% by Jan 2020. This trend is likely to continue for the foreseeable future as demand continues to outstrip supply. The longer you wait, the more you will end paying.
2. Mortgage Rates Are On the Rise
In the most recent report issued by Freddie Mac dated Mar 18, 2019, it was noted that the current 30-year fixed rate mortgage stood at 4.31%. This is the lowest it has been since February of 2018, and it’s not expected to stay this way for long. In fact, leading experts from Fannie Mae, The Mortgage Bankers Association, the National Association of Realtors, and Freddie Mac all say that by this time next year rates will have gone back up. Every increase in the mortgage interest rates will affect both your monthly payment and the final payoff amount.
3. You Are Paying Someone’s Mortgage
No matter whether you choose to continue renting or decide to buy a home, the one thing you need to understand more than anything else is that in either case, you will be paying someone’s mortgage. That is barring the possibility that you have found somewhere to live rent-free like with your parents. If you are renting, you are helping your landlord pay their mortgage and build equity in their property. On the other hand, investing in a home of your own means paying off your mortgage while at the same time building equity in your property that you will access to at a later point in your life. This begs the question, “Who do want to help build equity in their property, yourself or your landlord?”
4. It’s Time to Make a Bold Move
The final “cost” of your home will be calculated using two numbers: the initial price of the property and the interest rate you are paying. It’s a little more complicated than this, but these are the most important numbers. And beyond the current “blip” in the interest rates, both of these numbers are only going to keep going up. If this isn’t a good enough reason all on its own, keep in mind whose equity you want to build.
Then, of course, you need to consider the reasons why you are considering buying a house. In most cases,buyers are looking for safe neighborhoods to raise a family. Some are looking for a place they can renovate or modify to suit their needs and numerous other reasons. If you buy a home this spring instead of waiting, you could be getting a lot more house for a far better price— justsomething to think about.