The housing market is soaring right now, but should that scare you out of buying? Here are some good reasons why you shouldn’t hold off on finding your dream home!
Question: I have been saving up for a down payment with plans to buy a house and feel ready. But, with the real estate market hotter than ever right now, I’m wondering if I should go ahead with my purchase or push it off until the market settles down. Should I buy a house now?
Answer: The real estate market has been hit particularly hard by the coronavirus pandemic. Coupled with several factors, like falling interest rates, moratoriums on foreclosures or evictions and an increase in demand, prices have driven upward across the country.
According to a Zillow report published in April 2021, as many as 11% of Americans have moved since the pandemic’s outbreak, with more planning to move in the coming year. States that boast of a low or no property tax, like Texas and Florida, have been flooded by an influx of newcomers, as have suburbs all over the country and vacation hotspots. Homes are in such high demand, Zillow reports that nearly half the homes up for sale in the U.S. during the month of May 2021 have sold in under a week.
This increase in demand has led to skyrocketing prices, and many homebuyers are delaying their purchase in hopes that the market will eventually cool off. However, under certain circumstances, it can still be an excellent time to buy a house.
Here are three good reasons to buy a house now:
Interest rates are still historically low. While rates have risen since their all-time lows at the height of the pandemic, they continue to linger at record lows. Many experts predict a sharp increase in rates over the next year and advise house hunters to take advantage of low rates while they last — even an increase of just 1% can translate into tens of thousands of dollars over a 30-year loan.
There are more homes on the market than you may think. While it is a seller’s market and bidding wars are the norm right now, more homeowners are putting their houses up for sale. According to Realtor.com, home sales are up by 44% compared to a year ago. Also, now that the federal moratorium on foreclosures has ended, more homes are likely to enter the market in the next few weeks and months.
It is generally the better financial choice to buy. While you will need to make sure you can actually afford to buy a house right now, owning a home is usually the better financial choice. Homeownership provides long-lasting equity, significant tax benefits and more stability than renting. Instead of throwing money at your landlord each month, every mortgage payment you make toward your home builds your own equity.
If you are ready to apply for a home loan, consider a mortgage from SeaComm! Our experienced mortgage originators are here for your financing needs. Click here to access our Mortgage Center to apply online! Questions? Call us at (800) 764-0566 or stop by your local SeaComm branch – we are happy to help.