Tim Bradford - AMMCorp.net

head_left_image

Wait until next year to buy your home - Prices could be 3% less....

Below is a great post from another member at ActiveRain.  His post simply shows how the difference in the Price of a Home and the interest rate on the loan go hand in hand.  To any homebuyers that read this posting, if you have the want or need to become a homeowner, the best time is now.   You can see what home prices and interest rates are today.   Find the right home for a price that is affordable to today.   As the economy improves, which I believe everyone wants Interest rate are more likely to increase and housing prices would most like increase as well.  Only if you want the economy to decline more, should you hope for lower home prices.   Jeff warns be very carefulof what you hear from others.  With low rates as they are today and home prices having declined, I believe the upside risk is greater than the risk of higher prices and higher interest rates.   Just my opinion, as Jeff says look at everything and then decide what to do.

 

Be very careful on what you hear from others when it comes to the real estate market

 

 

do some real estate related questions confuse you?

There is some news out there from realtors and so-called experts advising buyers to maybe wait for a year or so.  This kind of stuff angers me for many reasons.  Here is a question I just read from a potential home buyer:

"Where do you think home prices will be by the end of this year and by next June 2011 in New Jersey."

 

Answer by a realtor :

"I'll go with down 3% end-of-year and 5-6% by next June. Employment number continue to be terrible, so there is no hope of appreciation for the short term. There is also more and more inventory which will add to negative price pressure."

 

 

balancing home prices with your mortgage payment

 

Nobody has a true crystal ball. All many of us can do is speculate, use our knowledge, expertise, and common sense. But if you are dealing with someone that doesn't look at something from both sides of the fence, to give you good knowledge and food for thought, it could cost you thousands of dollars.

Trying to determine when a good time to purchase a home can be frustrating at times. Asking yourself, if we wait a tad longer, we could get a better deal. What the realtor stated above, I will not disagree with.  There is some logic to what he stated.  But giving you this information and not taking it to the next level, could make your decision a bad one. Let's explore it some more.

 

 

 

Comparing future depreciation of homes by 3% to 6%

comparing future depreciation

 

 

 

 

 

 

 

 

 

 

 

This scenario is taking into consideration that you are currently renting or that you own a home. So if you bought a home now and compared it to buying a home in 6 months, by December 2011, you would have gained slightly on the difference of equity by buying now. If you take in account the 3% difference in the home price in 6 months from now, and the fact that your payment would be $33.32 more a month, you would have spent $399.84 more in mortgage payments. Yes, you would have bought a house for $7,125 less with the 3% depreciation, but by December 2011 that difference would only be $5,044. Then subtract the $399.84 in extra payments, then that difference drops to $4,644. KEEP in MIND - You will also be starting an interest deduction sooner if you bought now also, which I didn't figure into the whole equation. Which means you would write some of this off in 2011 which you would not have until 2012 if you bought at the end of the year. (my main focus was just showing if you bought now than in 6 months from now)

 

 

Summary : You need to ask yourself these questions. 

  • Why are you buying a home? 
  • Can you actually afford to buy a home now?
  • Review your goals. Your 3 yr, 5 yr, and 10 yr goals. The average person stays in their home for 6.7 years. 

 

Overall, you hear so much talk about people being upside down in their homes.  Ignore this and go back to my questions, the main reason to why you are buying a home.  It's normally a long term investment, a place to grow with memories, to raise a family, and so many other reasons. There is no crystal ball that tells you what interest rates will be in 6 months or where home values will be.  Think clearly before listening to just one side.

 

Buy now or wait ???  If I was in the market to buy, felt comfortable, had all my ducks in a row, I would buy NOW.

 

 

For good reading :

Mortgage Interest Rates - Mortgage Market Reports - June 29th, 2010

 

I have BLOWN a gasket in Real Estate !!! Using FHA loans & being upside down ?


 

_____________________________________________________________________________________________________

 

follow Jeff Belonger on Twitter               The FHA Expert   

                                                                                                           FOLLOW ME ON FACEBOOK

 

 

- FHA Loans - USDA Loans - VA Loans -

- Energy Efficient Mortgages - 

- Conventional Loans - 203 k loans -

- FHA Home Loans - Mortgages -

 

Experience & Knowledge at its BEST !!!

 

 

Follow me on:

Mortgage Myth Busters

 

 

_____________________________________________________________________________________________________

For more information on FHA loans, please go to this link. The FHA Expert

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

HUD

For information about FHA myths & FHA rumors, please read : FHA Myths & Rumors

 

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc


Tim Bradford
Ohio Mortgage Banker LO.007173.000/ NMLS 250013
Cell: 216.324.8113 Anytime
www.GetAMortgageNow.com or www.Go2Apply.com
www.OhioHomePath.com or www.OhioRuralHomeLoans.com

Serving the Ohio Realtors and Home Buyers and Home Owners
Comment balloon 0 commentsTim Bradford • July 01 2010 06:01PM

Comments

This blog does not allow anonymous comments