Real Estate Agents always tell you “now is the best time to buy”. The question you need to ask is why? Although the comment is always the same, the answer should not be. If “now” truly is the best time to buy, why “now” versus earlier or later?
Here are 3-reasons why “now” is the best time to buy:
Free Money from Uncle Sam
The original tax credit for first-time home buyers was only a few month’s, not nearly enough time to make much of an impact. The National Association of REALTORS® lobbied for a one-time extension of this credit, which was successful. Buying anytime after April 30, 2010 will mean you don’t get to take advantage of a free gift of $8,000 from Uncle Sam if you are a first-time home buyer. But what if you aren’t? Keep reading.
You may miss out on historically low interest rates.
Just days ago, MSNBC was featuring stories regarding the sudden spike in mortgage rates. Ben Bernake has already stated that once banks start lending more, he will raise rates. This means that the rates won’t be going down anymore, but they could be going up...soon...and fast. A 1% difference on your interest rate could mean several hundred dollars more on your payment. It may be a decade or more before rates drop this low again.
You may miss out on historically low home prices.
Home prices have dropped steeply since the “housing bubble” burst. However, as the Fed moves to curb inflation, interest rates will go up. As the economy further stabilizes, especially in Utah, home values have already started to flatten out. In some areas they are even going up. This is a very good sign that we may have hit the “bottom” of the housing market. In 12-18 months when the economy has vastly improved, everybody will be buying. That will create demand. That demand will result in a correction in home values pushing homes $5,000 - $15,000 higher. Competition also means you must fight harder for the home you fall in love with. Avoid competition and higher prices, buy today.