Real Estate Appraiser
According to the latest indicators, the real estate market is finally making a slow rebound. Although the improvements are slow, it is beginning to become healthier. Each property appraisal demonstrates how home prices are still staying on the lower side of the market. With these changes occurring how does a homeowner know for sure if this is a good time to purchase or not? For those who have been contemplating this financial investment, it may be time to make a move.
Interest Rates and Property Prices
Back in 2006, home prices reached a peak. Since then they have fallen more than 30%. Interest rates are also hovering near some record lows. The unique combination of lowered interest rates and home costs can make this the best time to purchase property in most regions. Investors are nearly standing in line snatching up properties that are being foreclosed on; or those offered through short sale. The really good news is that interest rates on fixed mortgages fell below 3.5%. This tilts the market toward benefiting the borrower. Experts state that those who miss out in today’s market may forfeit a perfect buying opportunity.
Good Signs It’s Time to Buy
Earlier this year we witnessed measurable rises in housing starts. Stocks for home building have continued to rise and this means those who can make investments in property and rent them out it can be a profitable exchange as rental prices are increasing. Rental prices are at a 10 year high with the median sitting at about $710 per month. Analysis of the real estate market indicates that in 100 of the nation’s largest metropolitan areas it is now cheaper to buy than it is to rent. In today’s market if you purchase a home you can save the difference that it might cost you for renting, even if you only stayed in the home for 5 years. For those who can purchase property and rent it out it is very likely that the rent will cover the cost of any financing. And the next time there is a residential appraisal it is likely that the property will appreciate.
Why Shouldn’t You Buy
The trouble comes in when you look at where the real estate market is presently, even though we are seeing a slow recovery. Between 30 and 50% of the existing mortgages in the US real estate market are in poor shape. The recent market sort of trapped a large number of borrowers in their loans and homes. They only have two choices, keep on paying or hold on to hope that the prices will improve. But this puts downward pressure on many home prices. Even though foreclosure rates have slacked off, many market analysts believe they are likely to make another increase. The trouble is that during the financial crisis nearly 4 million homes were foreclosed on; however, almost 1.5 million are still on the national foreclosure inventory.
It is possible that a full housing recovery will not occur. Many are worried that what progress has been made could be wiped away by a negative economic climate. The reason behind these fears is that the housing market never shows significant growth when the unemployment rates are high. Those who desire to purchase a home have to feel secure in their jobs before they will be willing to commit to any long term mortgage agreement. And lenders prefer to see a constant income history before loaning any money.
Balancing it all Out
Sure there is a lot to be afraid of when purchasing property. But in today’s real estate market purchasing a home is a long term investment and many are attracted to them because they should hold pretty steady even if the market makes some ups and downs. Right now, in most regions purchasing makes more sense if for no other reason than that it is cheaper to make a loan payment than to pay rent. Plus homeowners receive a tax deduction for the interest paid on a mortgage.
