Why Buying Now Is Worth It
Why Buying Now Is Worth It You might be uncertain about whether to buy a home now or wait. However, don’t forget to consider the equity you’ll gain as prices rise. Experts predict that home prices will increase over the next five years—based on those forecasts, you could potentially gain around $90,000 in equity during that time. So while you can wait, doing so means missing out on a significant amount of equity. If you’re ready and able to buy, let’s connect so you can start building your wealth now.
Why Did More People Decide To Sell Their Homes Recently?
Why Did More People Decide To Sell Their Homes Recently? Homeowners typically slow down their moving plans as summer comes to an end, resulting in fewer homes being listed for sale in the fall. This is a predictable seasonal trend in real estate. However, this year, mortgage rates decreased just as the number of homes on the market usually begins to decline. So, what happened? More homeowners chose to sell, leading to an increase in available homes. The latest data from Realtor.com shows that in September, the number of homes listed for sale rose by 11.6% compared to the same time last year. As indicated by the green circle in the graph below, the usual September decline in homes entering the market did not occur—instead, that number actually increased (see graph below): Ralph McLaughlin, Senior Economist at Realtor.com, explains the reason behind the unseasonable rise: “This sharp increase is largely due to the decline in mortgage rates in mid-August, enticing homeowners to sell.” As rates decreased at the end of summer, more people entered the market and decided to make their move. What Does This Mean If You’re Looking To Buy a Home? This means there are more fresh options available for you to choose from than you’ve had in a while—not just homes that have been lingering unsold. However, it's important to note that mortgage rates have been volatile recently, with a slight increase in the past few weeks. This could make some homeowners hesitant to sell in the coming months. In this market, mortgage rates are largely influencing homeowner decisions. Why Buy Now, Rather Than Wait? Whether you're searching for a starter home, looking to upgrade, or hoping to downsize, you currently have more options available. If you find what you're looking for, keep in mind that these new listings won’t be on the market forever. Staying informed about what's available in your local area with a trusted agent is essential. Also, remember that one month’s data doesn’t establish a trend. So, what does this mean for the future? Whether more homeowners continue to list their homes will largely depend on mortgage rates and the economic factors that influence them, such as inflation, employment, and the Federal Reserve's reactions. With this in mind, now could be your moment, while there are more homes available—if you’re ready, willing, and able to buy this fall. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), explains: “The rise in inventory – and, more technically, the accompanying months’ supply – implies home buyers are in a much-improved position to find the right home and at more favorable prices.” Bottom Line As rates decreased at the end of summer, sellers began to gradually return to the market, providing buyers with more choices right now. Let’s connect to ensure you have a trusted advisor to help you navigate these new options before they’re all taken.
The Benefits of Using Your Equity To Make a Bigger Down Payment
The Benefits of Using Your Equity To Make a Bigger Down Payment Did you know? Homeowners often have the opportunity to put more money down when purchasing their next home. After selling their current house, they can apply the equity they’ve built toward their next down payment. This is why, as home equity reaches new heights, the median down payment has also increased. According to the latest data from Redfin, the typical down payment for U.S. homebuyers is $67,500—nearly 15% more than last year and the highest amount on record (see graph below): Here’s why equity makes this possible: Over the past five years, home prices have risen significantly, resulting in a substantial increase in equity for current homeowners like you. When you sell your house and move, you can apply that equity toward a larger down payment on your new home. This presents a major opportunity, especially if you've had concerns about affordability. It's important to remember that you don’t have to make a large down payment to purchase your next home—there are loan programs available that allow you to put down as little as 3% or even 0%. However, many current homeowners are choosing to put more money down because it comes with some significant benefits. Why a Bigger Down Payment Can Be a Game Changer 1. You’ll Borrow Less and Save More in the Long Run When you use your equity to make a larger down payment on your next home, you won’t need to borrow as much. The less you borrow, the less interest you’ll pay over the life of your loan. That translates to significant savings in your pocket for years to come. 2. You Could Get a Lower Mortgage Rate Making a larger down payment demonstrates to your lender that you’re financially stable and not a high credit risk. The more confident your lender is in your credit score and your ability to repay the loan, the lower the mortgage rate they are likely to offer you. This, in turn, increases your savings. 3. Your Monthly Payments Could Be Lower A larger down payment not only reduces the amount you need to borrow but also means your monthly mortgage payment may be smaller. This can make your next home more affordable and provide you with some extra breathing room in your budget. 4. You Can Skip Private Mortgage Insurance (PMI) If you can put down 20% or more, you can avoid Private Mortgage Insurance (PMI), which is an additional cost that many buyers must pay if their down payment is smaller. Freddie Mac explains it this way: “For homeowners who put less than 20% down, Private Mortgage Insurance or PMI is an added insurance policy for homeowners that protects the lender if you are unable to pay your mortgage. It is not the same thing as homeowner's insurance. It's a monthly fee, rolled into your mortgage payment, that’s required if you make a down payment less than 20%.” Avoiding PMI means you’ll have one less monthly expense to worry about, which is a significant benefit. Bottom Line Down payments are currently at a record high, primarily due to recent equity gains that allow homeowners to put more money down. If you’re considering selling your current house and moving, let’s collaborate to determine how much home equity you have right now and how it can enhance your buying power in today’s market.
Why an Agent Is Essential When Buying a Newly Built Home
Why an Agent Is Essential When Buying a Newly Built Home For some buyers, there’s a misconception that newly built homes aren’t durable or lack the quality found in older homes. Unfortunately, this belief is causing some buyers to overlook what could be one of their best options in today’s housing market. As Builder Online states: “As resale inventory remains limited and the price spread between new and resale homes narrows, new homes are increasingly an attractive value proposition for buyers, with incentives such as rate buydowns a way to help address ongoing affordability challenges.” So, is there any truth to the myth? Let’s explore the best ways to ensure you feel confident about considering new home construction. This way, you won’t miss out on a great option available today. Choosing the Right Builder The key to ensuring you get a quality newly built home is to select a reputable builder. Reputable builders follow strict building codes and standards, employ advanced construction techniques, and often provide warranties that cover structural issues for several years. That’s why The Mortgage Reports provides this advice: “When embarking on the journey of buying a new construction home, one of the most important steps is selecting the right builder. This decision can significantly impact the quality and satisfaction you derive from your new home.” While you could research all the builders in your area, there’s a simpler option: rely on a professional. When you work with a local real estate agent, they already have knowledge about the builders and new home communities currently being constructed in your area. Additionally, they may have worked with other buyers who chose homes in those neighborhoods. Here are just a few of the ways your agent can assist you: 1. The Builder’s Reputation: Your agent will guide you toward builders with strong reputations and positive reviews from past buyers. They will also ensure that the builder is licensed and insured. Additionally, membership in professional organizations, such as the National Association of Home Builders (NAHB), is a good indicator of a builder’s commitment to industry standards. 2. Their Model Homes: Your agent will also let you know if the builders have model homes available for tours. When your agent walks through the model with you, they’ll highlight the important details that matter most, such as the quality of finishes, layout, and overall ambiance of the home. 3. Builder Warranties: Your agent will also assist you in navigating any builder offers or incentives. Reputable builders typically provide warranties that cover major structural elements of the home for an extended period, demonstrating their confidence in the quality of their construction. 4. Getting Inspections: Even with newly built homes, inspections are essential. Your agent will coordinate inspections with licensed professionals to ensure the home meets safety and quality standards before you move in. Agents Are the MVP When You’re Buying a Brand-New Home Perhaps that’s why data shows homebuyers consistently rated their agents higher than their builders when reflecting on their recent purchase: So, there’s no need to worry that they don’t build homes like they used to. By collaborating with a knowledgeable real estate agent to select a reputable builder, you can feel confident when purchasing a newly built home today. As Realtor.com states: “If you are interested in buying a new construction . . . You need your own real estate agent from the get-go. Even if it seems like plug and play to sign up with the builder’s on-site agent, you’re going to want someone representing your side of the deal.” Bottom Line If you’re thinking about buying a brand-new home, don’t let misconceptions hold you back. Let’s collaborate to find a home you’ll love and be proud to call your own.
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