Home prices have been rising for over seven years, and mortgage interest rates for five years. So, should you wait to buy a home? The numbers say no.
According to the National Association of REALTORS®, the median existing-home price is more than $250,000, the highest it’s ever been. If you wait to buy a home, you’re losing the opportunity to build equity, or ownership, in a home of your own.
If you’re worried that homes are priced too high and you’re afraid of losing money, consider this: the U.S. Bureau of Labor Statistics reports that prices for housing were 50.88% higher in 2018 versus 2000, for an average increase of 2.31 percent a year. The average inflation rate for the same period was 2.07 percent. Homeownership beat inflation by 0.24 percent.
In North Fulton County, over the past year, the average price for homes sold increased by 5.4%
Mortgage interest rates hit all-time highs in October 1981, when a benchmark 30-year fixed rate was 18.45 percent (with 2.3 points paid by the borrower), according to Freddie Mac. The lowest took place in November 2012 at 3.35 percent with 0.7 points. At about 4.5 percent for a conforming fixed-rate for those with good credit, mortgage interest rates are still tantalizingly low.
The best time to buy a home is when you want to, not when you think the market timing is best.
Unless you have a crystal ball, you don’t know if prices and interest rates will recede, plateau and or rise. Look at home buying for the long term, and you’ll be glad you didn’t wait.
As always consult your financial professional for interest rate information and advice. What’s happening in your neighborhood? Let’s have a conversation. My 30 years plus of experience will help you make the best business decision. Call or Email Cathi at The Lund Group …
Resource: Talking Real Estate, Berkshire Hathaway HomeServices, June 2018