Based on prices, mortgage rates and soaring rents, there may have never been a better time in real estate history to purchase a home than right now. Here are five major reasons purchasers should consider buying:
1. Supply Is Shrinking
With inventory declining in many regions, finding a home of your dreams may become more difficult going forward. There are buyers in more and more markets surprised that there is no longer a large assortment of houses to choose from. The best homes in the best locations sell first. Don’t miss the opportunity to get that ‘once-in-a-lifetime’ buy.
2. Price Increases Are on the Horizon
Prices will bounce along the bottom this winter. However, projections call for appreciation after that. Several studies and surveys call for price increases over the next few years. One recent survey shows that prices will increase over 10% by 2016.
3. Rents Are Skyrocketing
Rents historically increased by 3.2% on an annual basis. even more, several reports mention rents double in 20 years. Wharton recently reported that rents “for the most expensive places are declining while rents for cheaper places are rising, adversely affecting those on the lower end of the income scale”.
4. Interest Rates Are at Historic Lows
The central bank has raised rates four times since December 2015, when it hiked for the first time since before the financial crisis. Still, from an eagle eye view, interest rates have remained at the lowest levels in the last 5,000 years of civilization, according to a recent report from Business Insider.
5. Buy Low, Sell High
We would all agree that, when investing, we want to buy at the lowest price possible and hope to sell at the highest price. Housing can create family wealth as long as you save and not spend the extra money.
To be fair, unless you’re an extremely disciplined saver, homeownership still makes up for more wealth than renting a house. So, the principle remains, it’s time to buy!