Rates are Increasing
Mortgage rates are on the rise, but it is nothing to panic about. Back in the 80’s rates were topping out at 18%. In 2016 rates were below 4%. The rates have started to rise slightly and are now hanging out around 4% to 4.25% in many locations. Experts are predicting that by 2019 they could be at 6%.
No one likes to hear that rates are rising, but remember that it only bumps up your mortgage payment slightly each month. However, if you are ready to buy a house right now then why wait until the rates are higher?
The good news about rates increasing is it typically forces sellers to be more willing to negotiate, and it also lowers the amount of competition that you have when trying to get an offer in on a house.
Inventory is Down
Buyers typically do not want to buy when inventory is down because it creates the atmosphere of a seller’s market. However, the predictions are that inventory will continue to decrease. If that happens, it means there are more houses on the market right now for you to look at and compare than there will be in 2018.
This holding true would mean that sellers will have the power to continue to increase the price that they want from buyers, meaning you will pay even more. 2016 saw a 10% decrease in homes on the market from 2015.
As more buyers come on the market trying to find houses to buy during the busy real estate season the inventory will drop even further.
Home Values are Increasing
The longer you wait to purchase a house the higher the value of the homes are rising. Houses are continuing to be worth more and more every year. Last year the houses had increased in value 5% from the year before and they are expected to continue increasing 2% to 3% throughout the year.
With interest rates and home prices increasing and inventory decreasing you want to get in the market before it is too late. As it looks like these trends are going to continue, the longer you wait the more money you will end up paying for a house in the end. If you have been playing with the idea of buying a house it is to your benefit to get started today to take advantage of the low rates and current home values before the go up.