Potential home buyers are the best judges of when it’s the right time to buy a house. Successful home purchases involve more than just getting a house at a low price. Buyers have to consider whether their income can tolerate the weight of a mortgage and if they have the time to maintain a house on top of all of their other debt obligations.
The ongoing economic slump has caused interest rates on home loans to drop. If you can qualify for a low-interest mortgage, now is the best time to buy a house. Any time someone can qualify for a low-interest home loan is the right time to buy a house. Homeowners pay thousands of dollars in interest charges over the life of a home loan, especially if they sign a traditional 30-year mortgage.
One factor to consider whether this is the right time to buy a home: Qualifying for a mortgage is likely to get harder, not easier. The goal of Washington in the coming years is to shift more of the mortgage market out of the hands of Fannie Mae and Freddie Mac and into the hands of the private market. There’s already a new regulation being considered that would require banks that want to keep selling 100 percent of their mortgages to Fannie and Freddie to hold borrowers to tougher lending standards.
Another thing to consider: Demand for rentals the past few years has increased due to foreclosures and fewer existing renters deciding to buy a new home. That pushes up rental prices. Rents are expected to rise an average of about 5 percent over the next year. That percentage goes up in prime markets.
One of the most important facts you should consider when determining whether the right time to buy a new house is now is not to the market but your own situation. Think about how long you plan to live in the home. If you feel fairly confident that you will be living in the home for at least five years, then now could be a really good time to purchase a house. Don’t see your home only as an investment.
Any time can be a good time to buy a house as long as you can comfortably afford the mortgage payments. People who purchase homes tend to do so with a picture in their mind. They view their home as a place to live, raise their families and improve the quality of their lives. IF the home fits their viewpoint, they will be happy with their houses regardless of property values.
Open houses may seem to be crowded these days, but the weak sales pace is proof that there are fewer serious buyers looking to make a deal. That makes it less likely you’ll find yourself in a bidding war. It also means you can negotiate more successfully with sellers. Wait to long and you could end up with competition for the home of your dreams. If you are a serious buyer, now may be the best time to get ahead of those waiting for low prices that may never come.
Are you ready to take on the responsibilities of home ownership? This question is one of the best determiners on whether it’s a good time to buy a home. Consider whether you’re willing and able to handle routine home maintenance, repairs, yard work and other responsibilities that go along with owning a house. If you aren’t ready for these responsibilities, this is not the time to make such a huge purchase.
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