We all know that home prices are ridiculously lower than they were in 2006. And yet, there is still doubt in people's minds that now is a good time to buy. So, besides the obvious, here are three advantages of buying now.
1. Low Interest Rates
In November of last year we hit record low mortgage rates in the 3 point range. Rates are still very low, but clearly on the rise. Though home prices may get lower, you could actually end up paying more for a home if you wait for the price to go down, but the interest rates rise.
Example: You're looking to purchase a home in Folsom that is $200,000. You believe that Folsom home prices are going to drop and that it will soon be $190,000. However, during the time it takes Folsom home prices to drop, interest rates rise from 4.75% to 5.25%. Doesn't seem like much, huh? Well, when you do the math, you see that if you had bought the home for $200,000 at 4.75% for a 30 year term, you would spend a total of $375,586.08 (and even less if you pay off additional principal along the way). But, if you waited for the home prices to fall to $190,000 your rate would then be 5.25% and you would spend $377,707.33. In this instance, you only spend an additional $2000, but with more expensive homes, you end up spending even more on interest.
So by purchasing sooner, you will be in your new home quicker and end up paying less overall.
2. Great Selection of Homes
Right now is prime time to begin searching for a new home. Being that Spring is finally here, and Summer is on it's way, homeowners are beginning to put their homes on the I know your saying to yourself, "But that happens every year." And you're right. But what doesn't happen every year is a prediction that future years will bring fewer foreclosed homes and short sales. So, take advantage of the fact that there are still tons of REOs, Short Sales, and well priced "normal" sale homes on the market.
3. It Is Costing More and More to Rent
This actually means two things. First, if you are currently a renter, it is becoming so expensive to rent a home that you should be taking advantage of the first time home buyer loan programs, low interest rates, and the mortgage interest deduction on your taxes. These three items alone make it more affordable to own than rent. If you don't believe ฝากขายอาคารพาณิชย์ you can purchase right now because it seems like you need lots of money for a down payment, talk to your trusted mortgage lender and find out about all of the low or no down payment programs available.
Second, if you are looking for a savvy investment opportunity, owning rental units could be your next venture. There is going to be no shortage of renters in the next several years and rental prices are on the rise. There are tons of different types of rental properties, and I'll be writing more on this topic in the future, but please know that purchasing a rental property can get you instant cash in your pocket and earn you a sizable amount of equity in the future. Double bonus!
So there you have it - three fantastic reasons to get out there and start looking for your new home or rental property in 2011.
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