Many potential home buyers often receive advice from a number of different people before they purchase a home. Whether the advice is wanted or not, it is important that the home buyer is fully aware of the current real estate market and only listens to what an experienced real estate agent has to say rather than what friends and family are telling them. The only people that truly know if it is a good time for them to purchase is the home buyer themselves and a real estate expert. To determine whether or not the time is right prospective home buyers should ask themselves and their agent a few different questions before jumping into the real estate market.
First and foremost, a home buyer should ask themselves why they want to purchase a home. Perhaps they’re tired of renting, they want to invest and build their equity or they need more space. The only person that can truly determine this is the potential home buyer; this is generally where the advice received from outside parties is unwarranted. According to a recent study, there are four main reasons that people decide to purchase a home and none of them have to do with money. Most home buyers decide to purchase a home because it will give them the opportunity to raise their children and give them a good education in a desired neighborhood, they can feel safe and they have more space that they can control. Whatever your reason is for purchasing a home make sure your decision isn’t swayed by a third party.
The other two questions a home buyer should ask about purchasing have to do with finances. The first of these is “Where are property values headed?”. A few years ago, many people decided to purchase only to have their property value decrease drastically. This resulted in lost equity and many people being unable to afford their homes. Currently, most real estate experts expect property values to increase by around 5% by the end of next year and anywhere from 11% to 20% by the end of 2018. This shows that purchasing a home, no matter the reason, is going to be a good investment for home buyers.
Home buyers should also find out if mortgage rates are expected to increase or decrease. When you consider that a majority of home loans are for 30 years even the slightest increase or decrease can have a big impact on how much money is actually spent throughout the life of the loan. Real estate experts predict that mortgage rates will increase by about 1% in the next year so purchasing now might be better to save money in the long run.
When it comes down to it, only the potential home buyer can really determine whether or not the time is right for them to purchase a home. Sure, a real estate expert can tell them all the market stats and whether it’s a good financial decision, however, purchasing a home isn’t always about money. If there are wants or needs that aren’t being met by your current living situation, maybe its time to buy but remember, the choice is yours and only yours.