Searching for a new home requires patience, hard work, and sometimes, a little luck. When the economy is less than ideal, it forces people to make decisions that are not in their best interest. The good news is: right now is the perfect time to buy a house. There are three huge advantages homebuyers must keep in mind before jumping into the market.
The government is preparing for a housing boom. Both Fannie Mae and Freddie Mac have set aside less money than usual to protect themselves in case of a housing market implosion. This is a direct result of faith in the continuing upward trends that have been going on since the economic collapse. Here are the three main reasons why right now is the perfect time to buy a house.
Reason #1: Recovery of the Housing Market
The economy is improving rapidly. According to the National Association of Home Builders, fifty-nine metropolitan areas have completely recovered from the market crash that sent home numbers plummeting. “Our builder members tell us they are starting to see more optimism in the field. Mortgage rates are low, home prices are affordable and with the harsh winter behind us our latest surveys show builders are feeling more bullish about future sales,” said NAHB chairman Kevin Kelly.
Even with issues such as the ability to afford a home and low credit scores, there has been no better time for a potential homeowner to decide to get into the in-town Atlanta housing market.
Reason #2: Buying Is Cheaper Than Renting
With the housing market in full recovery, home prices are rising. Even with that statistic, Forbes released evidence that buying a home is much cheaper than renting. As of right now, a 30-year fixed rate is 38% cheaper according to Trulia. But there’s more to the story. Rising mortgage rates have been closing the gap over the past few years. Last year it was 44% cheaper to buy than to rent, which means the time is now to take advantage of the soft market.
Reason #3: Low Mortgage Rates
In 2014, the mortgage rates were hovering around 4.29%. As of this year, the rates have slowly declined and are now at 3.7% for a 30-year fixed rate. Frank Nothaft, chief economist and vice president of Freddie Mac, commented on the fall: “Mortgage rates continued moving down following the decline in 10-year Treasury yields after a dismal report on real GDP growth in the first quarter.”
If those weren’t enough reasons to entice a potential homeowner to get start his journey, here’s another: Fortune Magazine and Deutsche Bank released a study of “The Best Places in the U.S. to Buy a Home”, and Atlanta, Georgia took the top prize. That’s due to the astronomical cost of renting, which is more than 50% higher than an after-tax mortgage payment.
Atlanta also led the nation in the construction of new homes just before the major real estate crash. This means the supply was high and demand was low, causing home prices to take a tumble. This is also happening all over the country. The great economy has people looking to buy homes and get away from renting.
To keep up with demand, new houses are going up all over the place. Even in once-defunt rust belt cities, like Flint and Detroit. Old houses and blight are being knocked down to make room for new housing developments.
