I’m NOT Suggesting Now is a Good Time to Buy or Sell Just so I can Make a Commission

 

I think it’s a really good time to buy right now, for many buyers who are qualified to do so. Yes, there are challenges depending on your local market especially if it favors sellers are our does - competing multiple offers, buyers with cash and forgoing appraisals, and decision making to offer or not that must be concluded in hours not days.

 

I have told a number of sellers that I truly believe now is a great time to sell, although that obviously depends on financial and personal considerations, and for some it may not be right. But with buyer demand and limited inventory, sellers are in a far more favoable position than in years.

 

But I’m not suggesting now is a good time to buy and sell just so I can earn a commission.

 

Yes it’s true, my livelihood depends on buyers buying homes and sellers selling them. I don’t make a penny working with a buyer or selling if the property doesn’t cross the closing table. I’m cool with that.

 

Part of my role as a real estate professional is to provide education and advice, to offer options, and to share my opinion, in response to questions from buyers and sellers, backed up with data.

 

There are some sound financial reasons for me, and others in our business, to share our beliefs that now, as it has been for some months, is a good time to buy or sell in many parts of the housing market. That, of course, depends on your personal and financial circumstances and objectives.

 

Fact. Prices are going up in many parts of the country.

 

The recent S & P/Case-Shiller index, as just one source, indicates significant price increases earlier this year in many major metropolitan areas, San Diego included. Granted this only tells you where prices have come from and were a couple of months ago, confirming what many consumers have noticed by watching the market.

 

Major analysts have revised their price increase projections for the year upwards (e.g., BOA, Capital Economics, Deutsche Bank, Freddie Mac, J.P. Morgan - see chart above). Original price increase projections, ranged from 2% to 5.5%, are now projected to be 4.5% to 8% by year end (chart courtesy of Keeping Current Matters).

 

It will cost you more to buy a comparable house down the road, unless the market shifts again. And while waiting may yield you a higher price on your home, if you are moving up you are going to pay proportionately more, too (5% more on your $500K home is $25,000, but that $650K move-uphome may be 5% more, too, which is $32,700 additional).  And that down-sized home will likely have become more costly in a few months that it is now.

 

Fact. Interest rates have risen.

 

They are still excellent but you will pay more now for the same mortgage than you would have several weeks ago.  And a mortgage down the road will likely cost even more if the projections of higher interest rates (e.g., Mortgage Bankers Association per Keeping Current Matters) by year end are correct. I know several buyers who no longer qualify for what they did a few weeks ago, down about $20K in terms of purchasing power, because of the jump in rates which can make a big difference in your house hunting.

 

Combine increasing prices with higher rates and what happens? You get an even more significant increased cost if you should decide to wait to purchase - see chart at left (Keeping Current Matters).

 

Of course waiting may be in your best interest, depending on what you want to do, your plans after selling a home, your ability to buy, and your overall financial situation.

 

Your best option?

 

Work with a knowledgeable REALTOR who can tell you what the local market conditions are and what they mean for you as a buyer and/or seller. No crystal ball, here, and no one knows for sure where things will go. But the trends are pretty strong, and if you do want to buy or sell, you had better get the scoop to understand the potential implications of waiting.

 

Talking with a trusted mortgage professional makes sense, too, especially if you are looking to buy now.

 

Want to know more about my local Carlsbad and North San Diego housing market conditions? Give me a call or shoot me an email. I have lots of up to date information to share.

 

 

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ALL ABOUT THE SOUTHERN CALIFORNIA RELOCATION DUDE

 

If I can provide more information about Carlsbad homes and real estate for sale and surrounding areas, the housing market in general (or locally), or otherwise assist you, friends or family in a home search or sale, please contact my mobile office or text me at (760) 840-1360 or email me at JeffDowlerSolutions@gmail.com

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