Now is a great time to purchase a home. Here are three major reasons to buy today.
Most of the people in the market have a common knowledge when it comes to home affordability. Since home prices have appreciated they assume that they can't afford a home. Here are three components on how to determine home affordability.
- Mortgage Interest Rate
It is true that prices are up but so are wages. Interest rates have recently dropped dramatically. NAR (National Association of Realtors released the latest Affordability Index report that homes are MORE affordable today compared last year.
“All four regions saw an increase in affordability from a year ago. The South had the biggest gain in affordability of 6.9%, followed by the West with a gain of 6.0%. The Midwest had an increase of 5.8%, followed by the Northeast with the smallest gain of 1.8%.”
2. Mortgage Interest Rates
Mortgage rates almost dropped a full point after heading toward 5% last fall and early winter. Now it's below 4%.
Additionally, Fannie Mae recently predicted the average rate for a 30-year fixed mortgage will be 3.7% in the second half of 2019. That compares to a 4.4% average rate in the first quarter and 4% in the second quarter.
With mortgage rates remaining near historic lows, Fannie Mae and others have increased their forecasts for housing appreciation for the rest of the year. If home price gains are about to re-accelerate, buying now rather than later makes financial sense.
3. Increase Family Wealth
A new report by ATTOM Data Solutions reveals:
“U.S. homeowners who sold in the second quarter of 2019 realized an average home price gain since purchase of $67,500, up from an average gain of $57,706 in Q1 2019 and up from an average gain of $60,100 in Q2 2018. The average home seller gain of $67,500 in Q2 2019 represented an average 33.9 percent return as a percentage of original purchase price.”
Basically, the longer you delay purchasing a home, the longer you are waiting to put the power of home equity to work for you.
With affordability increasing, mortgage rates decreasing, and home values about to re-accelerate, it may be time to make a move. Let’s get together to determine if buying now makes sense for your family.