Heads up for some good Terravita Market News!
Thanks to everyone who stopped by the season opening Open House on Sunday. It feels great to be back in the saddle again, and I am very optimistic about this season! While I don’t feel the change in the weather yet, I really think I feel the change in the market. But don't take my word for it. If we can work it out, I am going to bring in the foremost authority on the real estate market here in the Valley to present next month. If you are interested, save the date for the morning of November 19th.
In my September month end wrap-up, I mentioned the extraordinary reduction in inventory the Valley has recently experienced. That speaks to a very local phenomenon that I believe will ultimately turn out very well for sellers, and for buyers that get off the fence soon. But I wouldn't expect the media to catch on any time soon - at least not our local media.
The national media may be a bit ahead of the curve though, and I thought you should know about it:
Last week, in an article entitled It’s Time to Buy That House, the WSJ told their subscribers:
“It’s an excellent time to buy a house, either to live in for the long term or for investment income…Houses aren’t the magic wealth creators they were made out to be during the bubble. But when prices are low, loans are cheap and plump investment yields are scarce, buyers should jump.”
In an article two weeks ago, MarketWatch.com (the online blog for WSJ) told their readers:
“Now could be the best time in history to buy a home.”
In a report to their subscribers, Capital Economics reported that:
“The previous declines in house prices and the more recent drop in mortgage rates to record lows have created an unusual situation in which the median monthly mortgage payment is more or less the same as the median rental payment.”
Why is this important? Last week, Forbes explained to their readers:
“If rents simply kept up with inflation at a 3.2% annual increase, a $1,500 rent payment would cost that renter nearly $900,000 over the next 30 years. The same $1,500 payment made to their mortgage would be only $540,000 (because the payments don’t increase with inflation).”
They went on to explain the advantages of homeownership during retirement:
“Even with a dismal 1% growth rate over 30 years, a $300,000 property would appreciate well over $100,000 giving the homeowner an additional nest egg for retirement…
At a time when retirement is becoming much more challenging, an extra $400,000 (or likely more) can make a major difference not to mention the impact of NOT having to pay a mortgage. How much less would you have to save for retirement if you didn’t pay the mortgage?”
When the local market appears to be making a large change, and an iconic financial newspaper and the financial magazine say that it makes financial sense to purchase a house now . . . it could be time to buy a home!