Hello Kathy - Here Are Your Articles for Friday, August 19, 2016
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Kathy Healy
Kathy Healy
Broker Associate
(630) 567-6345
kathy@kathyhealy.com
1772 S. Randall Road
Geneva, IL 60134
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4 Reasons You Want to Buy a Home This Year

 

If you have been sitting on the sidelines since the housing collapse, fearful of taking a chance on buying a home, the wait is over. Even with tighter credit standards, 2016 may be the best time to buy a home. Take a look at these top four reasons now is the time to find your dream home.
 
#1: Rates on the Rise: Mortgage rates are at an all-time low since 2012. These rates won't last forever. The Federal Reserve is expected to begin increasing interest rates soon, which means the window for record-low mortgage rates is closing.
 
This is the perfect time for low-income and first-time homebuyers to enter the market. Depending on your credit score, you could get a rate as low as 3.5 percent with an FHA (which is short for "Federal Housing Authority") loan. Think about this: In the years before 2012, the interest rate on a typical mortgage was as high as 10 percent!
 
#2: Skyrocketing Rents: After the housing collapse, many homeowners were forced to become renters again. Rentals became more popular as home buying became less affordable. Since that time, the rental market has exploded. As renters poured in, rent prices soared.
 
Now rent prices are as high as a monthly mortgage payment. On a national level, interest rates would need to rise to around 6.5 percent for the cost of buying to equal that of renting. If you were waiting to buy a home because renting was cheaper, the paradigm has been inverted and you are likely paying more each month in rent than you would for a home.
 
#3: Lower Tax Bills: All homeowners can get deductions for their property taxes and interest payments. That can further reduce the difference in cost between renting and owning. There may be breaks for first-time homeowners as well—consult your tax advisor.  
 
#4: Dwindling Inventory: Finally, there are others who have been waiting for the housing market to stabilize to buy a home. Those buyers have already been taking advantage of the low interest rates and affordable housing prices, which has resulted in dwindling inventory.
 
New home construction is down and so is new multiunit construction. If you wait too long, you may be looking at pre-crisis home prices again, as well as interest rates over 6 percent.
 
You have more options now than before, especially if you're looking to move from renting to homeownership. This is a great time to enter the market — such low rates can increase at any time.

 
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The information provided in this email newsletter is for general guidance only, and does not constitute the provision of legal advice, tax and accounting advice, real estate investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional real estate, tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Home value estimate calculators provided herein are general estimations based on publicly available data and should not be used as a substitute for a professional appraisal. The information is provided “as is,” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
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