Five Important Reasons Why Now is a Great Time to Buy a House
- Interest Rates - Bankrate reported this week, that mortgage rates are at their lowest point ever in their survey taking history. They have been conducting rate surveys since September 1985. The national average for a 30 year fixed rate mortgage is approximately 5.13%. This is great news if you are considering buying. Consumers are pretty smart and if you read or listen to the news, you will see that refinancing has increased dramatically. Why do you think this is? If the interest rates are going to drop further, it will most likely be minimal. One thing that you can count on, they will begin to rise and they go up much faster then they go down. The current interest rate alone, is a really good reason to consider purchasing a home.
- Housing Prices- Everyone knows that housing prices are down in most regions. The National Association of Realtors reported that housing prices dropped 12.4% in the final quarter of 2008. The median price for a U.S. home sold during the fourth quarter of 2008 fell to $180,100. NAR reported that sales were up in February, but median prices have dropped even further from 4th quarter. NAR's official report for the first quarter of 2009 will be released in May. Do you think prices are going to continue to decline? Perhaps, but most likely only slightly. Two good reasons to buy, keep reading.
- Seller Motivation - Due to the current market conditions, it is pretty easy to identify motivated sellers. In many instances, you can easily find a motivated seller by looking at the property description. Look for keywords such as: "motivated seller," "make an offer," or "must sell." Other considerations include consistent price reductions. If you like the property and the seller is motivated, then you should seriously consider making an offer. If you don't, chances are someone else will get their first and you will have missed your opportunity. You don't want that to happen.
- Tax Advantages - Current tax law allows homeowners to utilize deductions on their returns for interest paid on mortgages or home equity loans. Local property taxes can also be used as deductions on your income taxes. If you are paying rent, you do not qualify for these deductions. The federal government is also offering some incentives in the stimulus package. One of the most widely publicized is the $8,000.00 first time home buyer tax credit.
- Timing - You must have heard the expression "buy low and sell high," right? It might even be your mantra. As with any investment, it is ideal to purchase when prices are low rather than at their peak. However, if you are waiting to purchase a home because you believe prices will continue to drop, you might miss out of an ideal opportunity. The time to "buy low" is right now. Once everyone comes to the realization that prices may already be at their lowest point, then you can rest assured that buyers will jump in and start buying. It might not be a mad rush anytime soon, but the best deals will be the first target.
Now you know, this is a great time to buy a house. There is plenty of inventory, interest rates are low, house prices are down, sellers are motivated, you can take a tax deduction or you may qualify for up to an $8,000.00 tax credit, plus the timing is perfect. You have nothing to lose and so much more to gain.