Is it a Good Time to Buy or Invest in San Ramon Real Estate?
As many real estate professionals say, now is a great time to buy a home. But is that really true at any time in the market? Absolutely not! In the 80s when interest rates were through the roof, buyers had a very difficult time affording any type of home because the monthly mortgage payment was just too much to bear. With the housing bubble bursting in the early 2000s, there were too many homes on the market and prices started to plummet. While that’s good news for buyers since interest rates were still low, investors need to check the rate of return and how much profitability each property will bring them.
The Housing and Real Estate Market in 2013 - Are you Ready?
Homes have been extremely affordable over the last few years but are starting to rise. The recent existing home sales showed a fifth consecutive month of home prices higher than just a year ago. So what is this mean for affordability? Have buyers and investors missed their opportunity to purchase?
The Housing Affordability Index
According to Realtor.com, the Housing Affordability Index is a scale which rates housing affordability. 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. An index above 100 means that a family earning the median income has more than enough income to qualify for home loan with a down payment of about 20%. This means that the monthly principal and interest payment cannot exceed 25% of the median family monthly income.
What’s interesting is that although home prices have gone up the Housing Affordability Index has basically remained the same. Homes have become a slightly more affordable which means that some median incomes have increased over the last couple years. How is this possible? Mortgage rates are nearly a percentage lower than they were just a year ago and incomes continue to rise.
So what does this mean for buyers and investors?
Whether you’re a first-time buyer, purchasing your tenth home, or an investor looking for rental properties, now is a great time to buy since mortgage rates are still extremely low, there’s a plethora of inventory still on the market, and incomes have increased. Due to all these positive factors, the negative factor that home prices have risen slightly, shouldn’t be that much of an issue.
Things to Consider When Buying a Condo in San Ramon CA
With this positive upswing, now is really a great time to be buying. Let’s invest in condos, single detached homes, or complexes in the San Ramon area. I specialize in assisting investors and first-time buyers alike so let’s get started on finding the right property in Contra Costa County.
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