A buyers market is when there are more houses for sale then there are buyers. A seller's market is when there are more buyers then there are houses for sale. Right now, we are in a seller's market. According to Redfin, a typical home is selling in 1-2 weeks and homeowners are seeing multiple offers on their homes. So, what does this mean for buyers? should you buy now or wait?
If you're thinking of buying a house, you might be wondering if now is a good time to do so. After all, with the coronavirus pandemic raging on and the economy still in recovery mode, it's natural to feel wary about making such a major purchase.
Here's the thing, though: interest rates are at an all-time low right now, which means your monthly mortgage payments will be lower than they would be if you waited to buy later down the line. Additionally, experts predict that prices will start to rise again soon as the economy continues to improve—so if you buy now, you could see some solid appreciation on your home in the years to come. The bottom line is that there are pros and cons to buying a house during any period—it all depends on your unique situation.
et's take a closer look at some of the factors you should consider before making your decision:
Your financial situation: Obviously, one of the most important things to think about before buying a house is whether or not you can afford it. Take a close look at your income and expenses and make sure you have enough room in your budget to comfortably make mortgage payments each month. It's also a good idea to get pre-approved for a loan so you know exactly how much money you have to work with.
Your job security: Another important factor to consider is job security. If you're worried about being laid off or furloughed shortly, now might not be the best time for you to buy a house. You want to make sure you have a steady income coming in before taking on such a large financial responsibility.
The local market: Another thing worth looking into is the state of the local housing market where you're thinking of buying. Check out recent trends in home prices and see how much inventory is currently available—if there aren't many houses on the market and prices are rising rapidly, it might be worth waiting a while before making your purchase so you don't end up overpaying. However, if there are plenty of houses available and prices seem to be stable or slowly rising, now might be a good time to take advantage of low-interest rates and buy while they're still affordable.
Your timeline: Finally, think about how soon you want or need to move into your new home. If you're in a rush to find somewhere to live, buying may be your best bet since it will allow you to move in right away once everything is finalized. However, if you're not in any hurry and can afford to rent for a while longer while saving up for a down payment or waiting for prices in your desired area to drop, renting might make more sense for your situation—just keep in mind that rents can also rise unpredictably over time just like home prices can.
Now let's review what we've learned... Buying a house is always going to involve some level of risk—after all, no one ever knows exactly what's going happen in the future and even small changes can impact the housing market. However, if you do your research and weigh all the pros and cons carefully, purchasing a property can be an extremely rewarding experience that will pay off handsomely down the road—especially if you manage to snag a great deal on an interest rate!
Luxury Real Estate Advisor | Principal | John Bathurst Group | Founding Member | Compass South Bay | DRE# 01977487
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