With the economy in its current state, you may be wondering... is now a good time to buy a home?
A number of factors are contributing to "now" being a great time to buy:
1) Lots of inventory. There are many houses on the market providing a wide array of choices. It's a buyer's market allowing for better terms and conditions on your next home purchase.
2) Low interest rates. Mortgage interest rates are historically low. There is no way to know for certain if rates will go lower. One thing for sure, rates can move in any direction at any time. There is no way to "time" or predict the bottom of the market. Think about it for a minute: How will you recognize when the bottom of the market occurs? You won't. The bottom of the market won't be known until after it has occurred, turns, and continues in the opposite direction for some time. At the point of recognition, you will have missed the opportunity to buy at the bottom. The last "bottom" in interest rates was around the second week in January of this year. Rates have not been that low since. Many missed that opportunity to buy. If you're ready to buy, ask your lender about rate locks and float downs to protect your interest rates. Don't be a fence sitter, act now.
3) Prices of homes are lower in many markets. This can translate into a mortgage with lower monthly payments for the home you plan to buy (less money for the home) or a better value home at the price you had planned to pay (more home for the money).
How the Stimulus Plan Benefits Homebuyers
According to the National Association of Realtors® (NAR), the American Recovery and Reinvestment Act of 2009 includes elements of NAR’s housing agenda, including:
Homebuyer Tax Credit: The bill provides for an $8,000 tax credit that would be available to first-time home buyers for the purchase of a principal residence on or after Jan. 1, 2009 and before April 30, 2010 with the recent extension to the first time home buyer tax credit. The credit does not require repayment.
FHA, Fannie Mae and Freddie Mac Loan Limits: The bill reinstates last year's 2008 loan limits for FHA, Freddie Mac, and Fannie Mae loans. These limits were equal to the greater of 125% of the 2008 local area median home price or $271,050 for FHA and $417,000 for Fannie and Freddie, with an overall maximum cap of $729,750.
For more information about what the bill means for the housing market, click here.
-- “American Recovery and Reinvestment Act of 2009,” Realtor.org, Feb. 17, 2009.
Mortgage money is readily available for well qualified home buyers (good credit, adequate funds for downpayment and closing costs, secure employment). The key to obtaining financing for your home purchase is "You Gotta Qualify".
Now is a good time to buy!
Contact your local Realtor for more information on your current housing market situation.