What Will A Home Be Worth in Two Years if I buy Today?
By: David Kucic, Hawaii Real Estate Agent
The Team Kucic Home Selling and Buying System
Overwhelmingly, this is the one question that I am asked by nearly all of my buyers. Since I have many first time buyers, it is a question that I would expect them to ask. Most of the veteran homebuyers that I deal with have already been through the process of buying and selling and they are much more aware of what the answer is.
The bottom line is that NOBODY KNOWS FOR SURE. I can say this with the utmost of confidence that there is nobody who is able to predict what the future holds and can tell you that your investment will appreciate or depreciate. A common phrase used amongst my fellow real estate professionals is "nobody has a crystal ball".
What I can tell you is that when you rent rather than buy, chances are you are not going to build wealth like a homeowner will be doing.
Do you find it difficult to put some of your earnings into a savings account each month? When you own a home, you are "forced" into saving. What I mean by this is that with each mortgage payment you make every month, a portion of your payment goes towards the "principal" of the loan. By paying on this principal each month, you are reducing the principal balance and over time, that is what your savings becomes. THE SOONER YOU BUY, THE BETTER CHANCE YOU HAVE TO GET AHEAD FINANCIALLY IN LIFE.
You also have a tax advantage when you are a homeowner. At the time of this post, you are able to deduct the interest portion of your mortgage payment when you file your federal tax return at the end of the year. There are many different cases with taxes and each person is different so check with your tax professional for specifics about taxes.
There is also the potential benefit that you have which is the reason for me writing this post. As long as property continues to appreciate over time, you will also be building wealth and equity as the price of homes continues to climb as it has done throughout history.
A few other reasons for this being the perfect time for you to go out and buy your own home NOW are: Interest rates are SOME OF THE LOWEST WE HAVE SEEN IN HISTORY (Jeff Belonger, The Mortgage Man) and we are in a buyers market.
You must think long term. Don't plan on getting rich with a two or three year investment. If you will buy and then sell within a few years, it might not be wise for you to buy in the first place.
Think in terms of the stock market: "Buy low and sell high". Translated to real estate that means to "buy during a buyers market (NOW) and sell the property when the value appreciates or we are in a "sellers market".
My advice to my buyers is to purchase something as soon as possible. When it is time to move then you must look at the condition of the market before you make a firm decision to sell. If the market will not support the sale of your home to your satisfaction, then you can either hold onto it and make the mortgage payment while leaving the home empty or put a renter into the property. In either case, do this until the market will support the sale of your home and then sell.
Aloha and happy house hunting!
http://activerain.com/action/blogs_admin/www.davidkucic.com
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Aloha!
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