Should I Buy?
If
you are a ready, willing, and able buyer, now is the time to consider buying a
home. Everyone is waiting for "the bottom". But how will
you know when the market has reached the bottom? When it goes up, that's
when! Then it may be too late to negotiate the best deal.
Historically Low Rates
Interest rates on long-term,
fixed, and adjustable mortgages are at historically low levels. The Fed started
cutting interest rates to bolster the economy in September, and recently has
turned much more aggressive. In eight days in January, the Fed slashed rates by
1.25 percentage points — the biggest single-month reduction in a
quarter-century. Since September, the Fed has cut its federal funds rate - what
banks charge each other on overnight loans - by 2.25 percentage points to 3
percent. It also cut its discount rate on direct loans it makes to banks by
1.75 points to 3.5 percent. Rates are expected to move lower at the Fed's next
meeting on March 18. Despite all this, mortgage rates are starting to creep up.
Consumers should lock in low rates now, before they go higher.
More Choices
With more homes on the market
for longer periods of time, buyers have more choices when it comes to selecting
a home today.
Better Loans
The foreclosure crisis has
motivated the government to create more consumer protections against predatory
lenders than previously existed. Of course with the tightening of lending
practices, less buyers are now qualified to buy a home. This has had a
dramatic impact on the market.
Negotiation Power
Since there are fewer
qualified buyers, YOU are in the driver’s seat. You are one of a
select few buyers out there and you have the power to negotiate!
Seller Concessions
Sellers in today's market are
competing amount many more sellers. Those that must sell are offering
incentives to get their homes sold. Many do not advertise these
incentives, but as your Realtor we can negotiate them for you. Seller's
can pay closing costs, pay HOA fees for a year, offer home warranties, buy down
your loan, drastically cut their price and more. Most bank owned
properties (REO) will also negotiate incentives from their already low list
price.
Purchasing Power
A temporary increase in the
conforming loan limit means consumers should soon be able to borrow at lower
interest rates for higher-priced homes. Prior to the increase, the conforming
loan limit was $417,000. The spread between jumbo, or non-conforming mortgage
loans and conforming mortgages is about 1.2 percentage points.
20-30% Drop in Prices
You know that neighborhood you
have wanted to live in but could never afford? You watched the prices
rise and rise until you could never afford it. Well, now maybe you
can. Or you can at least get one step closer. Maybe it's time to
get out of your townhouse, condo, less desirable neighborhood or
rental and move up. It's time to weigh your options.
This is a time of
opportunity. There is a lot of pent up demand in the marketplace. I
talk to buyers everyday who are "waiting for the bottom". Basic
supply and demand tells you that when everyone starts buying again seller
concessions will disappear, rates will go up, inventory will decrease and
prices will rise.
Call us today to help you find
the best value in today's market. If you are ready and able to make the
move, why wait? Now is the time to buy!
Call us or email us
today!