Every real estate market provides opportunities for different people; sometimes a market favors sellers, sometimes buyers. Because of rising rents, home prices and mortgage rates, this year, 2014, is one of the best times to buy a home in several years. There are five reasons to buy a home 2014:
1. Supply is increasing, albeit gradually. Inventory has been very low in Frederick County Md, down to historic lows in the last 2 years. A “normal” inventory is about 1200 homes for sale, while we’ve seen the inventory go down to the 600’s. Since those lows of 2013, the inventory has been increasing to the 800’s. The best homes in the best locations sell first, sometimes in days or weeks.
2. Rents are Rising. Historically, rents increase by 3.2% annually. Trulia reported that rents have increased by 3% year-over-year.
3. Interest Rates are at still near historic lows, although rising. Recent rates have been close to 4.5%. Since records have been kept, the average interest rates have been around 7.5 to 8%. (See today’s rates) There’s a reason why this term, historic lows, is being repeated throughout the media:
4. Home Values are increasing. Many experts are predicting that prices will improve between 3% and 5% this year. Each quarter, Pulsenomics surveys a “distinguished panel of over 100 economists, investment strategists, and housing market analysts regarding their 5-year expectations for future home prices in the United States.”
Here are the results of their latest survey:
PRICE APPRECIATION/DEPRECIATION EXPECTED OVER THE NEXT FIVE YEARS:
The average pre-bubble (1987-1999) annual appreciation was 3.6%.
5. The Best Financial Advice of All Time: Buy Low, Sell High. Buying real estate at the right time can be a great tool to create family wealth. These 5 reasons to buy a home are very convincing that 2014 is the right time.
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