Some Questions To Ask Before You Buy
Contracts To Buy Homes Rise For 3rd Straight Month
If you look at just about any reading of the current housing market, you’ll find that there are a lot of Americans interested in buying a home right now. Whether it’s because of pent-up demand that built up in the years following the housing crash or a drive to buy now while mortgage rates are still well below their historical norm, the fact is buyer demand is high. The most recent National Association of Realtors’ Pending Home Sales Index provides more evidence of this. That’s because the index – which measures the number of signed contracts to buy homes – ended the year with its third consecutive monthly increase. Lawrence Yun, NAR’s chief economist, says the housing market has started the year with a little bit of momentum. “Another month of modest increases in contract activity is evidence that the housing market has a small trace of momentum at the start of 2018,” Yun said. “Jobs are plentiful, wages are finally climbing and the prospect of higher mortgage rates are perhaps encouraging more aspiring buyers to begin their search now. More here.
Home Price Increases Mean Buyers Need To Prepare
It isn’t news that home prices have been headed upward for awhile now. And, according to the latest S&P Case-Shiller Home Price Indices, they are continuing to climb at around the same pace as they have been in recent months. Which is to say, the price increases haven’t yet slowed. Of course, how quickly prices are increasing depends on where you’re looking to buy. Large metropolitan areas – and especially those in the West – are seeing the sharpest increases, while the price gains are more muted in the Midwest. But, no matter where you are, the best way to prepare for higher prices is to know what you want, what you can afford, and where your limits are. In competitive and higher priced markets, having a firm idea of what you can spend and where you’ll compromise will make it less likely that you’ll end up going over budget because of a bidding war or buying more house than you can comfortably afford. Making sure you’re prepared before heading out to look at homes also means securing financing in advance, so you’ll be ready to make an offer when you find a home you love. More here.
Young Adults Hold Key To This Year’s Market
First-time home buyers are an important demographic when tracking the health of the housing market. That’s because, they typically make up nearly half of all home sales. In recent years, however, young Americans have been buying fewer homes than in the past. In fact, Freddie Mac’s most recent monthly outlook says 15 percent of young adults between the ages of 25 and 35 are living in their parents’ home – a five percent increase from 2000. However, it isn’t because they’re not interested in homeownership. Largely, the economy and a lack of affordable starter homes have been to blame for a lower-than-normal number of first-time home buyers. But with an improved economy and job market, will more young adults become buyers this year? Len Kiefer, Freddie Mac’s deputy chief economist, says there’s reason for optimism. “Starting off the year, things are looking pretty good for the U.S. economy and housing markets,” Kiefer says. “Mortgage rates are low, economic growth has accelerated in recent quarters, and housing is coming off its best year in a decade.” More here.
What To Do If You Live In A Competitive Market
These days, competition and affordability are two of home buyers’ main concerns. This isn’t surprising, as no one likes to pay more for less. Naturally, we prefer to find a bargain and we certainly don’t want to have to fight off other interested buyers to get it. That’s why recent research looking at the country’s most competitive markets is of interest. The results show the most competitive markets are located in the West, though in just about any desirable neighborhood you could find more buyers than available homes. That means, even if you aren’t living in San Francisco or Seattle, you should be ready for the possibility that you won’t be the only home buyer interested in the house you choose. So what’s the best way to increase your odds of beating the competition and getting the house you want? Preparation. Be prepared and get prequalified before you start shopping. Buyers with financing in place before they start looking at houses are more appealing to sellers. If you’ve got your financing in place and a firm idea of what your price range and budget are, you will be in better position should you find yourself in a bidding war. More here.
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What Drives Today’s Home Buyer
Current Homeowners Say They’re Ready To Buy
The National Association of Realtors’ Housing Opportunities and Market Experience survey asks consumers about buying and selling a home, their financial situation, and their perceptions of the economy. According to the fourth quarter results, Americans are generally optimistic about the housing market, with majorities expressing that they feel now is both a good time to be selling a home and a good time to buy a home. However, some groups are more optimistic than others. For example, among current homeowners, 79 percent say they feel it is a good time to buy a home. On the other hand, just 60 percent of current renters feel as optimistic. Other groups that were more optimistic included those with household incomes above $100,000 and those living in the Midwest and South. So what do the results mean? Well, one takeaway is that an increasing number of current homeowners who want to move could mean a potential boost in the number of homes available for sale next year. That’s good news for all prospective home buyers, as an increase in for-sale inventory will help improve affordability conditions. More here.
