Purchasing a home is a big life decision and everyone around you will want to give you advice. Sometimes the more advice we get, the more confused we might become in our decisions. Before taking the next step when it comes to buying a home, ask yourself these questions.
1. What’s Going on with Home Prices?
Currently, home prices are increasing due to low inventory and high demand from buyers. Remember that the price of the home will affect your cost on what you must put down to how much you will gain from your home’s appreciation.
Professionals in the industry are predicting an increase in home prices throughout 2021. The average of all the forecasts is around 12.46%. Fannie Mae predicts the highest forecast at 14.8%, the National Association of Realtors came in next with a 14.1% increase, Freddie Mac sees a 12.1%, Zelman an 11% and MBA a 10.3% increase on home prices in 2021.
According to these predictions, waiting to purchase a home might not be in your best interest. If you take the average increase from the forecast of 12.46%, a median-priced home costing $350,000 in January 2021 would cost $393,610 by the end of 2021.
2. Are Today’s Low Mortgage Rates Going To Last?
Mortgage interest rates can also determine how much you will not only pay monthly but also how much your home will cost you once paid off. The good news for current buyers is the mortgage rates are still at record-lows.
The industry professionals predict an increase in rates. Freddie Mac predicts an increase from 3.3% increase in 2021 3Q to a 3.6% increase in 2022 2Q, Fannie Mae suggests a 3.0 increase in 2021 3Q to a 3.2% increase in 2022 2Q, the Mortgage Bankers Association expects a 3.2% increase for 2021 3Q and a 4.0% increase in 2022 2Q, while NAR predicts a 29.% in 2021 3Q and a 3.5% increase in 2022 2Q.
3. Why Is Homeownership Important to You?
This will be different for every homebuyer as it is a very personal one. Determine your goal when it comes to buying a home. There are both emotional and financial benefits.
According to the 2021 National Homeownership Market Survey, six out of nine reasons American homeowners value buying a home are personal. These include stability, safety, a sense of accomplishment, a life milestone, a stake in the community and personal pride. The National Housing & Financial Capability Survey shows that 89% of purchasers believe owning a home will give them a sense of safety and security.
Remember purchasing a home is life-changing both emotional and financial. Choosing to use a Realtor will help you with both.