Buying a Home

The housing market hit a rough patch the last two years, with a big decline in existing home sales and a record increase in foreclosures.  With the media portraying a bleak outlook, buyers have been skittish, frightened to invest in an unsure future. The media, though, missed the bigger picture. There are many reasons why 2010 is a great time to invest in real estate.

Homes are more affordable than ever. Based on the median mortgage payment as a percentage of the median household income, homes are more affordable than they’ve been in a generation. At these lower prices, buyers can also get more for their money.  Waiting for the prices to get even lower? Don’t. The price indexes show that the market has hit bottom and home prices are appreciating.

Mortgage rates are at a fifty-year low. In August, mortgage rates dropped to a national average of 4.36 percent. The rate was 5.19 percent the same time last year. On a $200,000 home with 10 percent down, that’s a savings of $90 a month on a 30-year loan. With interest rates this low, now is not only the perfect time to buy a first home. It’s also a great time to buy a vacation home or investment property. With lenders back in the game, loans are available now to those with a job. The professionals predict that mortgage rates will not stay at this all-time low. Take advantage now.

Sellers are motivated. With the current housing supply at 12.5 months, supply has exceeded demand. And with foreclosures and short sales selling at an average 20 percent below market value, buyers now have the upper hand. They have a lot of choices, and smart sellers are doing what it takes to compete for the business. 

Buying is now more affordable than renting. Rental rates have decreased slightly, but home values have drastically declined, the gap wider than it’s been in 22 years. Now is the time to stop renting and invest in your future.

The American dream is closer than ever before. Most Americans still consider owning a home the American dream. A home serves as more than a place to live. It’s a savings account that leads to financial stability and wealth building.  It’s a safe haven for a family; a place for game night, barbecues, birthday parties and holiday gatherings. It’s a place to create lasting memories.

For these, and so many other reasons, 2010 is a great time to invest in real estate.