The Perfect Home Could Be the One You Perfect After Buying
There's no denying mortgage rates and home prices are higher now than last year, impacting what you can afford. At the same time, fewer homes are still available for sale than the norm. These are two of the biggest hurdles buyers are facing today. But there are ways to overcome these things and still make your dream of homeownership a reality. As you set out to purchase this season, you'll want to be strategic. This includes looking closely at your wish list and considering what features you need in your next home versus which ones are nice. This will help you avoid overextending your budget or limiting your pool of options too much because you're searching for that perfect home. Danielle Hale, Chief Economist at Realtor.com, explains: “The key to making a good decision in this challenging housing market is to be laser focused on what you need now and in the years ahead, . . . Another key point is to avoid stretching your budget, as tempting as it may be . . .” To help identify what you truly need, list all the features you'll want to see. From there, work to break those features into categories. Here's a great way to organize your list: Must-Haves – If a house doesn't have these features, it won't work for you and your lifestyle (examples: distance from work or loved ones, number of bedrooms/bathrooms, etc.). Nice-To-Haves – These are features you'd love to have but can live without. Nice-to-haves aren't dealbreakers, but if you find a home that hits all the must-haves and some of these, it's a contender (examples: a second home office, a garage, etc.). Dream State – This is where you can think big. Again, these aren't features you'll need, but if you find a home in your budget that has all the must-haves, most of the nice-to-haves, and any of these, it's a clear winner (examples: a pool, multiple walk-in closets, etc.). If you're only willing to tour homes with all your dream features, you may be cutting down your options too much, making it harder on yourself (and your budget) than necessary. While you'd love to have granite countertops or a pool in the backyard, those are things you could add after you move. Instead, it may be best to focus on finding something you can't change (like location or a certain number of rooms). Then, you can upgrade or add some of the other features or finishes you want later. Sometimes, the perfect home is the one you perfect after buying it. Once you've categorized your list in a way that works for you, discuss your top priorities with your real estate agent. They'll be able to help you refine the list further, coach you through the best way to stick to it, and find a home in your area that meets your top needs. Bottom Line With the current affordability challenges and limited housing supply, you'll want to strategically find a home that meets your needs while staying within your budget. Let's chat.
Invest in Yourself by Owning a Home
Are you wondering if it makes sense to buy a home right now? While today’s mortgage rates might seem intimidating, here are two compelling reasons why it may still be an excellent time to become a homeowner. Home Values Appreciate Over Time There’s been a lot of confusion around what’s happened with home prices over the past two years. While they did dip ever so slightly in late 2022, this year, they’ve been appreciating at a more normal pace, which is good news for the housing market. While looking at price movement over just a year or two can make you worry prices are usually this unpredictable, history shows in the long run, home values rise (see graph below): Using data from the Federal Reserve for the past 60 years, you can see that home prices have steadily climbed. Sure, there was an exception around the housing crash of 2008 that caused prices to break the usual trend for a time, but overall, home values have been consistently on the rise. Increasing home values is one reason buying may make more sense than renting. As prices rise and you pay down your mortgage, you build equity. Over time, that growing equity gives your net worth a boost. Rent Keeps Going Up Through the Years Another reason you may want to consider buying a home instead of renting is the never-ending rent hike. If you've ever felt the pinch of rent increasing year after year, you're not alone. That’s because rents have climbed steadily over the past six decades (see graph below): Buying a home can lock in your monthly housing costs and bid farewell to those pesky rent hikes. That stability is a game-changer. Ultimately, it all boils down to this: your housing payments are an investment, and you have a choice to make. Do you want to invest in yourself or your landlord? By becoming a homeowner, you're investing in your future. When you rent, that’s money you never get back. Homeownership can be a path to financial security when you factor in home values consistently rising, plus the opportunity to get relief from never-ending rent hikes. As Dr. Jessica Lautz, Deputy Chief Economist and VP of Research at the National Association of Realtors (NAR), states: “If a homebuyer is financially stable, able to manage monthly mortgage costs and can handle the associated household maintenance expenses, then it makes sense to purchase a home.” Bottom Line When it comes down to it, buying a home offers more benefits than renting, even when mortgage rates are high. Connect us to review your options to avoid increasing rents and take advantage of long-term home price appreciation.
People Are Still Moving, Even with Today’s Affordability Challenges
If you're thinking about buying or selling a home, you might have heard that it's tough right now because mortgage rates are higher than they've been over the past few years, and home prices are rising. That much is true. Take a look at the graph below. It breaks down how the current affordability situation stacks up to recent years. The National Association of Realtors (NAR) explains how to read the values on the graph: “To interpret the indices, a value of 100 means that a family with the median income has exactly enough income to qualify for a mortgage on a median-priced home.” The black dotted line represents that 100 value on the index. Essentially, the higher the bar, the more affordable homes are. As you can see, the orange bar for today shows higher mortgage rates and home prices, which have created a clear challenge. But while affordability is tighter right now, that doesn't mean the housing market is at a standstill. According to NAR, based on the pace of sales right now, just under 4 million homes will sell this year. With some simple math, let's break down what that means for you: 3.96 million homes divided by 365 days in a year = 10,849 houses sold each day 10,849 divided by 24 hours in a day = 452 houses sold per hour 452 separated by 60 minutes in an hour = about eight houses sell each minute So, on average, over 10,000 homes sell each day in this country. Whether you're a buyer or a seller, this shows there are still ways to make your move possible, even when affordability is tight. An Agent Can Help You Make Your Move a Reality You may wonder how other homebuyers and sellers are making this happen now. One of the biggest game-changers in today's market is working with a trusted local real estate agent. Great agents are helping other people just like you navigate today's market and the current affordability situation, and their insight is invaluable right now. True professionals can offer advice tailored to your specific wants, needs, budget, and more. They'll also be able to draw on their experience of what's working for other buyers and sellers right now. This could mean broadening your search to include different housing types like condos, townhouses, or neighborhoods a bit further out to help offset some of the affordability challenges today. Bottom Line You might think few people are buying or selling homes right now since affordability is tighter than it's been in quite some time, but that's not the case. Buying a home has become more expensive over the past few years, but people are still moving. If you're hoping to buy or sell a home today, know that other people are still making their goals a reality – and that's mainly happening because of the help and advice of skilled real estate agents. Want to talk to a trusted professional about your move? Schedule time to chat here. Courtesy of Simplifying The Market
10 Reasons Why Buying Beats Renting Even with Soaring Interest Rates!
Welcome to the world of savvy homebuying! In an era where interest rates are doing the tango with our bank accounts, making the leap from renting to owning a home can seem like a giant puzzle. But fear not, intrepid home seekers! Today, I'm diving into the top 10 reasons why buying a home, even with higher interest rates, can still be your most brilliant move. From building equity to anchoring your future, let's unravel the mystery and discover why getting those house keys might be your ticket to financial and emotional prosperity. Please sit back, grab your favorite brew, and let's embark on this enlightening journey together! 1. Building Equity - Every mortgage payment is like feeding your piggy bank, not your landlord's! 2. Say Goodbye to Rent Hikes - Lock in your monthly payments and wave farewell to yearly rent increases. 3. Tax Advantages Galore - Deduct mortgage interest and property taxes to keep more dollars in your pocket. 4. Redecorate Without Repercussions - Paint walls neon green or install that dream chandelier – your house, your rules! 5. Long-Term Appreciation - Real estate generally appreciates over time, turning your home into a wise investment. 6. A Retirement Lifeline - Pay off your mortgage and live rent-free during your golden years. 7. A Savings Plan in Disguise - Mortgage payments can be a disciplined way to save for the future. 8. Leverage Your Loan - Use your mortgage as a tool to build credit and financial credibility. 9. Deep Community Ties - Owning a home roots you in a community, fostering more profound connections. 10. The Priceless Feeling of Home - There's an incomparable emotional satisfaction in owning your home. And there you have it, future homeowners! We've navigated the twists and turns of why buying a home trumps renting, even when the interest rates are playing hard to get. Remember, your journey to homeownership is more than just a financial decision; it's a step towards your personal haven, a future investment, and a legacy in the making. So, what's your next move? Don't just dream about those door keys; reach out, take action, and turn those dreams into a reality. Drop a comment, share your thoughts, or send a message - let's connect and make your homebuying adventure a story worth telling!
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