Current Financial Conditions For Real Estate
The current financial conditions for buying a home is in question. We have heard that location, location, location is the primary item to look for when investing in real estate.
Is Buying A Home Right Given The Present Financial Conditions?
by Igor Buces
The current financial conditions are something to be considered by people who want to buy a home. There are three conditions that may help make an educated decision. The three market conditions are: lower house prices, larger number of homes for sale and lower mortgage rates.
If you watch the news, you may think it's a bad time to buy a home. However, the reality may be different. As with most things in life, successful people make good financial decisions by not following the crowd.
One of the main market conditions is the decreasing home prices. House prices in most markets have been going down for the last 12 months. This means that you can buy a home today for the same money that you could buy it over a year ago.
The next factor is the large number of houses for sale. Having so many houses in the market gives you the ability to choose among many different types of homes. With so many houses available, you have a better chance to find the type of home you want in the neighborhood that you want.
What's more, having several houses available in each neighborhood makes seller be more willing to negotiate the price and the terms of the sale. This way, you can reduce the price of the home further or you can have the seller help you with the closing costs.
In addition, you can also take advantage of the low interest rates. Interest rates have gone own several times during the last 12 months. They are at one of the lowest levels in the last decade. This translates in money being saved on your monthly payments.
A lower interest rate may mean a few hundred dollars in savings every month. In turn, these savings translate into tens of thousands of dollars over the life of the loan; Money you can use to pay additional debt, make improvements or simply use it for investment reasons.
On the other hand, most people don't want to buy a house for the fear that prices will keep going down in the near future. The truth is that nobody really knows how far prices will go down. It's impossible to anticipate how far they'll go down or when they will go up again.
However, if history can be used to understand economic cycles, it shows that real estate always ends up going up again. As a matter of fact, housing has been one of the most secure investments.
Giving all these factors, buying a home now may be the right choice to take advantage of the current market conditions. Of course, it depends on how long your individual financial circumstances and on how long you plan to be in your new home.
If you plan to stay in the home for only a few years, then buying a home now may not be a good choice. However, if you plan to make the house your new home for many years to come, then buying a house is something you should seriously consider.
Igor Buces is a mortgage broker and commercial loan consultant. You can find interesting articles about home loans and commercial loans in his
Miami mortgage page and his
http://www.commercialbusinessloans.us/commercial loan site.
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