Is Now A Good Time To Buy?


In short, the absolute answer is yes. But why?

First, it’s important to recognize that human beings are genetically pre-disposed to default to the negative in most situations and buying a home is no different for many, especially first-time homebuyers. It’s how our brains work to protect us from danger, whether the threat is real or imaginary. When it comes to buying a home, there are many aspects to look at from a micro and macro level. Here are key points to look at if you are considering buying a home in this market.

Supply and Demand

The massive increase in continued appreciation is a direct result of the lack of inventory and high demand for homes across the United States. Supply is low and remains challenging. That is not a bad thing when you own a home and are not looking to move. However, it typically causes frustration for potential buyers looking to get into the market.

We are seeing more inventory on the marketplace as of recent (which is relative, yet worth noting) and this is typical in the spring and heading into summer for those moving or trying to move around the school schedules with summer break and before the start of the next school year.

According to census.gov, there are 330 million people in the U.S. and 130 million household formations, with 1.4 million household formations being formed currently. A household formation is someone that resides in a property without relinquishing one. Examples include leaving the nest from mom/dad and going out on their own (buying or renting), a couple that is splitting and one person is getting their own place… someone moving into a new place without having a place to sell. These formations are absorbing the supply out there.

There are currently around 1 million homes in the U.S. for sale – 60% (600k) of those homes are under contract, leaving approximately 400k homes to meet demand, well short of balance when looking at buyers and sellers. That said, demand has been easing slightly due to increasing home prices and rising interest rates; however, there is still enough activity in the market to support current listing values.

While we may in fact see home prices start to slow their rapid rate of growth, this is likely not the start a year-over-year trend. There is a big difference between bottom-level appreciation or deceleration vs. depreciation.

Time In The Market Over Timing The Market

When is the best time to plant a tree? 30 years ago. The next best day is today.

In other words, whoever has owned their home the longest is sitting on the most equity. When it comes to gaining equity and building true wealth, time is your friend as a homeowner. Waiting for a perfect opportunity, whether that’s anticipating price decreases or lower rates, often backfires as markets

fluctuate due to several variables at any given time. Delaying action can be a frustrating proposition, especially in popular markets where housing remains severely limited.

Did I Miss The Boat?

The housing market has been astonishing over the past several years, largely due to enormous demand meeting a severe lack of inventory that has caused a sharp rise in appreciation. That said, while you cannot change market conditions or economic factors, remember people buy and sell houses every day. Your experienced mortgage professional can help guide a change in strategy and your approach to the market and how you get in and win.

A Lending Hand for Financing Home Mortgages

Spire Financial (A Division of AmeriFirst Financial Inc.) brings lending expertise to you. All of our loan officers offer personalized communication for every client, guiding them through the process. We can show you ways to maximize your finances and unlock future opportunities. Spire Financial keeps you in control of refinancing, debt consolidation, and home equity. Together, we can achieve your financial goals.

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Disclaimer


V.I.P. Mortgage, Inc. DBA Spire Financial does Business in Accordance with Federal Fair Lending Laws. NMLS ID 145502. For state specific licensing, visit www.vipmtginc.com/national-licenses/. V.I.P. Mortgage, Inc. is not acting on behalf of or at the direction of the FHA/HUD or the Federal Government. This product or service has not been approved or endorsed by any governmental agency, and this offer is not being made by any agency of the government. V.I.P. Mortgage, Inc. is approved to participate in FHA programs but the products and services performed by V.I.P. Mortgage, Inc. are not coming directly from HUD or FHA. Information, rates, and programs are subject to change without notice. All products are subject to credit and property approval. Not all products are available in all states or for all loan amounts. Other restrictions may apply. This is not an offer to enter into an agreement. Not all customers will qualify.

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