Everybody knows somebody almost ready to buy a new home, but there always seems to be a reason for not doing it “just yet.” Well, this fall in particular is a tremendous opportunity just waiting to happen for those who do choose to finally get off the fence and make that move. Let me explain the three reasons why.
1. Interest rates are something you hear about all the time. In fact, you’ve probably become immune to it. When it comes to buying a home, interest rates aren’t as exciting to talk about as the latest farm style trends or sleek, new Midtown skyline development. But right now, interest rates are like a doorbuster deal on Black Friday! Here’s why: interest rates directly impact how much house you can afford, and with rates dropping to below 4% (as of October 2019), that farm style house or Midtown condo with views for days might finally be within reach. Rates can be unpredictable, however. So what’s within reach this month might no longer be affordable next month. In other words, you can get a more expensive home today for the same monthly payment as the less expensive home you may have looked at this time last year.
2. I’m sad to report a different reality for Sellers—homes are starting to sit on the market longer, and we are starting to see more price reductions. Atlanta is always going to be a steady market, but multiple offer situations aren’t happening quite as frequently, depending on the area. What does this mean if you’re a potential Buyer? Paired with low interest rates, your buying power has increased even more now that you’ll have an easier time getting a lower purchase price. Over the last several years, the only way Buyers could reduce their spend was to capitalize on lower interest rate opportunities as they occurred because the market had been so hot for so long in favor of Sellers. Until now, Buyers have been forced to pay top dollar (and duke it out in bidding wars) in order to get the home they wanted. The market is simply stabilizing, and no housing market downturn is in the cards from what we can see.
3. If you are currently renting, the fact is this: you are throwing money down the drain. Right now, you are able to own a home for less than what is being charged in the rental market. There is no reason to fatten the pockets of landlords when you can not only own your own home, but gain an average of $50,000+ worth of equity in just 5 short years. First time home buyers are set up for significant financial gains as your home goes up in value and as you pay down the principal balance. It is a compounding effect!
What if I have a home to sell before re-buying?
While you may not be able to get the sales price you could have during a ridiculously low inventory market like we’ve seen over the last couple of years, you do have the opportunity to make up for any lost equity from the sale on the buying side. For example, if you have your eye on a home that has been sitting on the market for a while, you could likely purchase that home for less than what you could have a few months ago. So while you may not gain quite as much on your current home, you can make up for it on the other side. That’s the beauty of real estate!
For friends stuck on the fence, do them a big favor and share this blog. We’d love the opportunity to chat with them and answer any questions, big or small. You know our style—no pressure whatsoever. Referrals are the engine of our business. We are honored to serve those you graciously send our way.