Why You Should Buy A Home NOW

San Diego Why to buy a home nowThe holiday season is always a slow time in the housing market – people have things like baking turkey and hosting family to worry about, after all!  But there are some very compelling reasons to act NOW – BEFORE the end of the calendar year – if you’re thinking of buying a home.  Whether you live in San Diego or in another city entirely, buying a home before 2014 could save you a LOT of money.

 

There are several excellent reasons to consider buying before the end of the year.

 

  1. Interest rates will rise.

In San Diego as well as elsewhere, we’re currently experiencing the lowest interest rates we’ve seen since June.  However, a large part of today’s low interest rates is owed to a Federal stimulus program set to wind down in 2014.  The problem with low interest rates is that they have nowhere to go but up!  Experts predict that interest rates in the coming year will range from 5.5-6% (compared to their current rate just over 4%).

 

  1. Home prices are on the rise.

With the economy bouncing back, home prices have also been on the rise.  This year has seen one of the largest year-over-year rises in home prices since 2005. San Diego home prices were even ahead of the national average, rising 19% from June 2012 to June 2013 (see our post on San Diego Real Estate Growth for details).

 

  1. The Housing Affordability Index – calculated monthly by the National Association of Realtors – is going down.

The index is based on three things: median home price, median family income, and average mortgage interest rate.  Essentially, it predicts how affordable a house would be for the average family at current interest rates.  This index hit a high in January 2013 – the average family was making about twice the income necessary to qualify for a mortgage loan on the average home – but since May the index has been decreasing.  With home prices rising, the affordability index is going down: basically, houses may get less affordable the longer you wait.

 

  1. A slow market gives you power as a buyer.

With the market slowing down around the holidays, fewer people are looking for homes – which means that you, as a buyer, have power.  Any given home will have fewer offers on the table than a home on the market in summer, giving you a greater ability to negotiate.  If you buy now, a greater number of homes could be within your price range!

 

If you would like more information about the current housing market in San Diego, or about buying a home, give Katie a call at 858-922-2226 or check out her Rancho Santa Fe Real Estate website!

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