Don’t let negative media scare you away from purchasing a home.
Here’s something that all potential buyers in today’s market should understand: It’s never the right time to buy a home. Over the last couple of years, many people wanted to make purchases, but the market wasn’t perfect enough for them. Of course, rates during that period were lower than they’d ever been, which equated to increased affordability. But were properties actually affordable?
We were selling homes for 15% to 20% more than their list prices—and that’s outside the fact that we were listing some properties for more than what they were worth in the first place. So did low interest rates automatically make every property more affordable, or did everyone get caught up in a buying frenzy without focusing on the price they were truly paying?
Back then, many buyers told us they wished there was more inventory and the competition wasn’t so aggressive. Things were so heated that they couldn’t view a property and then go home to sleep on their decisions. If they wanted a fighting chance at getting the home, they’d have to submit their offers quickly and often for well above asking price. They weren’t even getting counteroffers, which meant that other buyers were pulling even crazier stunts to win homes.
“If you’re waiting for the perfect time to buy a home, you may never actually do so.”
If rates decline to the 2% to 3% range again, we’d see the same type of market as we did a couple of years ago. Buyers would start gobbling up inventory and prices would skyrocket. In this new market, however, inventory is over 100% higher than it was in January of this year.
Despite the increased inventory, we’re still in a seller’s market, and rates are still historically low. That means you have many more options, less competition, and more time to process information so you can make wise decisions. We’ve even begun to see sellers offering buyer concessions, which we haven’t seen in years. A buyer concession is when a seller offers to give the buyer a credit to buy down their interest rate.
Here’s the bottom line: We don’t know what the future holds for the housing market, but if you’re waiting for the perfect time to buy a home, you may never actually do so. Take your emotions out of the equation and rely instead on the numbers and your personal motivation for purchasing a home. Speak with a lender to understand the true cost of homeownership, and remember that even if rates are higher than you’d like now, you can always refinance your mortgage if/when they come back down again.
If you have any questions about what’s going on in the housing market or you’re ready to buy a home, give me a call or send me an email. I’d love to be a resource for you.