When is the best time to buy a house? The most common answer is . . . right now. The reasons vary and cover the spectrum, but one of those reasons is more compelling now than ever. These reasons why you should buy now range from building equity early to buying before housing prices go up to beating the rise in interest rates. It’s that last one you need to keep your eye on, especially now. Here’s why you should buy a house now before interest rates rise again in Essex County.
Interest Rates Now
Mortgage interest rates rose sharply in the first part of 2018 and have continued that trend throughout the year. And the consensus of those who keep a watch on these matters is that interest rates will rise again in 2019.
In fact, this year saw the highest level of interest rates since July of 2011, reaching 4.78%. The increase in interest rates will cause a home buyer to pay $10,000+ more for a $200,000 home over the 30-year life of the mortgage. And this trend looks likely to continue.
The trend of rising mortgage interests rates is forecast to continue over the next few years. Even if rates seem to have stabilized, that may not actually be the case because it’s never a gradual linear increase. Interest rates rise again in steep increments over a very short period of time. So if you don’t buy know, you can wake up one morning facing higher interest rates and higher mortgage payments.
Interest Rates in the Future
Interest rates have been below 5% for just a little over eight years now (except for a two-week period in February 2011). But financial and real estate experts say that interest rates will indeed go over the 5% mark and will stay there for several months. Still, they say it’s not likely to happen in what remains of 2018 – but it will happen… sometime.
According to the National Association of Realtors, Freddie Mac, and Fannie Mae, rates will probably increase by 0.1% to 0.2% before the end of this year. The problem is that no one can accurately predict when the rate will go over 5% because there are so many variables involved. So the reality may be that interest rates rise again in Essex County in the near future higher than expected.
So it may be wisest to buy now before rates go up. Your agent can advise you on the best steps to take in your area. Call (978) 877-2873 to find out more.
More Reasons to Buy Now
While home prices are still going up some, the pace of the rise in prices is slowing. This means that we may be moving away from a seller’s market to a buyer’s market. In addition, the supply of homes on the market is slowly increasing – which gives further leverage to buyers. These slower rising prices and increasing inventory make it less likely that you’ll have to engage in a bidding war to get the home you want.
But home prices will go up again at a more rapid pace at some point in the future. So your best bet is to buy now to take advantage of the prices and inventory and to slip in before interest rates rise again in [market-city]. In a tricky market like this, it’s crucial to have a good agent in your corner.