HOMEBUYING: Is now a good time to buy a home?
The biggest question that any homebuyer asks is: “Is now a good time to buy a home?”
It depends.
With higher mortgage interest rates and rising home costs, right now it might appear that your best move is to wait. You picture waiting it out for a bit and move forward to buy a home next spring – or even next summer. You figure that interest rates will surely lower and prices should drop, even if interest rates don’t.
However, no one has a crystal ball.
We don’t know what interest rates are going to do.
We don’t know what home prices are going to do.
We don’t know what home inventory is going to do.
If you are ready to buy a home now, have mortgage preapproval, have your down payment saved, and have your family prepped to move, you might want to harness that momentum and buy a home. You know right now that you are ready and have all your finances in place to make this big move.
Mortgage preapproval
If you have your home financing figured out and have mortgage approval in hand, you can afford to buy a home today.
However, if you are wavering because you need more time to improve your credit score, your down payment savings aren’t quite where you want them to be, and your job is unstable, then you might want to wait it out. You might not be ready. It might make sense to wait to improve your financial standing.
Down payment
If you’ve diligently been stashing away cash for your down payment, congratulations! With a sizable down payment – remember it does NOT have to be 20% of the purchase price of your home – you’re ready to buy.
However, if you are hesitant because you had to dip into your down payment savings for another expense, your savings rate has trailed off, or you aren’t quite at your savings goal, you might hold off until your down payment account is securely at your target number.
Prepared to move
Moving takes a lot of time, energy, and cash. If you are ready to make that leap to get into your new home, use your momentum and buy that home now.
If your family is facing hurdles – health, logistics, timing, or other issues – you may want to reconsider whether putting a move on the to-do list is going to cause unnecessary stress right now. It may be prudent to wait out a home purchase until the other issues are addressed.
Only you know your situation
You are the most knowledgeable about your situation and whether adding a home purchase and move into your life is the right choice.
However, if you’re ready to buy, don’t let others dissuade you.
Don’t fear higher interest rates if you know you can afford a home today.
Don’t fret over rising home prices if your finances can swing a home purchase.
Don’t worry about lower inventory of homes to buy if you find the home that works for you.
Rising interest rates
Keep in mind that you can refinance when interest rates go lower. There is no known timeline, but you do have that option available in the future.
Increasing home prices
If you jump into the homebuying market now, your equity in your home will grow quicker if home prices continue to rise. Equity is the difference between what your home is worth and how much you owe on your home loan.
Bottom line
There is never a perfect time to buy. There are too many variables in the market and too many variables in your own financial and personal life.
However, hindsight might be 20/20. Next year you might discover that right now would have been the perfect time to buy a home….
Looking to buy a home?
Check out Noir Holdings’ updated homes available in established neighborhoods in suburban Chicago: www.noirholdingsllc.com Buy direct from Noir Holdings and save!
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