Is it the right time to Buy?

There’s been a lot of media attention lately about the price of housing and what the market holds in store for the future. If you’re a prospective homebuyer, the news may leaving you wondering whether it’s a good time to buy a home and more importantly, whether it’s the right time for you. 

How you arrive at an answer to those questions partly depends on where you’re starting from.  If you’re starting out to buy your first home, it’s fairly straightforward. You calculate your carrying costs and the potential for return on your investment and then determine if that situation will improve if you wait.  With today’s low interest rates, the cost of carrying a home is now very affordable. The low mortgage rates also provide you with an opportunity to pay down more of the principal in those critical early years of your loan.  Paying even a quarter of a percent less interest in the early years of your mortgage could add up to a savings of many thousands of dollars over the life of your loan. Malcolm Bellinger, your Coldwell Banker sales associate will be happy to help you estimate what your expected mortgage, taxes, utilities and other carrying costs will be for a home in your desired price range. 

Your Coldwell Banker sales associate can also advise you on how much more your carrying costs will be when housing prices increase or when mortgage rates go up – or both!  In most cases, a simple calculation will show you that you have a lot to lose by waiting.  Not only would your carrying costs be higher if house prices or mortgage rates go up, you’d also lose any equity you could be earning as the value of your home increases beyond your original purchase price.  These factors will usually outweigh any savings you might realize by entering the market later with a larger down payment.  This is especially true when you consider you still have to pay rent on another location while you save for that down payment.

Perhaps you’re one of those fortunate people who already owns a home and you’re trying to decide if it’s a good time to sell it and buy another. You’ve got both ends of the transaction to consider, so your primary concern isn’t just the price of the home you want to buy. It’s the difference between the sale prices of the two properties that’s important.  If you’re upgrading, it pays you to act now and take advantage of the property appreciation that’s to come, and do it before the gap between the two properties widens.  Want more advice?  Talk to Malcolm Bellinger today!