Updated: Jan 21, 2021
If you have been thinking about making 2020 the year you buy your first home or a new home, you are probably wondering how you tell when the perfect time is to buy a house. The answer is simple: there is no perfect time to buy a house. Real estate is an ever changing market, so there will never be that "perfect time" or "perfect market conditions". The perfect time to buy a house is the time that best fits your needs, lifestyle & goals. For most people, buying a house is a benefit to them both financially & for personal/lifestyle reasons. If your goals, lifestyle, or needs are aimed towards buying a house this year, here are a few ways buying a home can benefit you financially too!
1. A home is generally a great investment & real estate is typically one of the best investements you can have. When you are considering how you want to invest for your future, one of the great things about real estate is that it tends to ride the ups and downs of the market better than many of the other investment tools you may be shopping for. Adding real estate to your portfolio also helps you diversify your investment strategy.
2. Right now, the mortgage interest rates are still pretty low. In Novemember of 2018, mortgage interest rates were sitting at an average of 5%, but the projection Freddie Mac has provided for 2020 has them sliding down to an average of 3.8%. Being able to buy when the interest rates are low gives you more buying power and saves you money down the line. If you are able to buy in a way that allows you to make additional monthly payments towards your principle too, you can pay off your loan even faster and save more money.
3. Renting is becoming increasingly expensive. While renting does work for some people in certain situations, for the most part, you are better off owning a home because you start building equity. You also do not have to move as frequently when you own your home (which costs a lot of money) and you are not subject to rent increases. As rents continue to rise, purchasing a home freezes that rising cost. While things like your property taxes, utlilities, and other living expenses continue to rise, the amount you are spending to pay off your principle and interest will remain frozen for as long as you keep that loan. This can act as a buffer for you when it comes to dealing with inflation & rising rental costs.
For the vast majority of people, owning a property typically turns out to be a good investment. If you are thinking about making 2020 the year you make a move, give us a call and we can help you make that move!