Here are four great reasons to consider buying a home today instead of waiting.
1. Prices Will Continue to Rise
CoreLogic’s latest Home Price Index reports that home prices have appreciated by 6.6% over the last 12 months. The same report predicts that prices will continue to increase at a rate of 4.3% over the next year. The bottom in home prices has come and gone. Home values will continue to appreciate for years. Waiting no longer makes sense.
2. Mortgage Interest Rates Are Projected to Increase
Freddie Mac’s Primary Mortgage Market Survey shows that interest rates for a 30-year mortgage hovered close to 4.0% in 2017. Most experts predict that rates will rise over the next 12 months. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison, projecting that rates will increase by nearly a full percentage point by this time next year. An increase in rates will impact YOUR monthly mortgage payment. A year from now, your housing expense will increase if a mortgage is necessary to buy your next home.
3. Either Way, You Are Paying a Mortgage
There are some renters who have not yet purchased a home because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that unless you are living with your parents rent-free, you are paying a mortgage – either yours or your landlord’s. As an owner, your mortgage payment is a form of ‘forced savings’ that allows you to have equity in your home that you can tap into later in life. As a renter, you guarantee your landlord is the person with that equity. Are you ready to put your housing cost to work for you?
4. It’s Time to Move on with Your Life
The ‘cost’ of a home is determined by two major components: the price of the home and the current mortgage rate. It appears that both are on the rise. But what if they weren’t? Would you wait? Look at the actual reason you are buying and decide if it is worth waiting. Whether you want to have a great place for your children to grow up, you want your family to be safer, or you just want to have control over renovations, maybe now is the time to buy.
If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings.
There is no other way to say it. We have years of not building enough housing, hold-over zoning for single family homes, increased traffic as we densify, a rail system in its infancy a crowded bus system and AirBNB. What could possibly go wrong?
I’m not sure why city officials didn’t see this coming although I’m sure they had other more pressing problems (?). I’m also not seeing a larger vision on how to make “it” better. But the issue is much bigger than repealing Costa-Hawkins* and trying to get SB827 ** through the state legislature.
Bottom line the city of LA’s population is growing. Because we have NOT been building enough housing AND more homeowners are staying put AND we have a strong demand for housing – both renting and owning – we are in a bit of a pickle to put it mildly.
A master plan is surely the best solution with all parties at the table including homeowners, renters, developers, planning officials, traffic experts, etc. In the end EVERYONE will have to compromise on some deeply held belief.
Building in the outskirts doesn’t work anymore when all the jobs are on the westside, central and downtown LA. That creates more traffic coming into and out of the city, which creates all that Waze traffic through your neighborhoods. Ugh! I get it.
Bottom line, LA City is changing and the growing pains are killing us as they show up in the form of high housing prices. We have a strong economy. You can’t put that genie back in the bottle; people are coming here and the numbers of households are increasing. Adding more density and housing are the only solutions. The next question of course, is the “how”. Stay tuned!
Crissi Avila will teach you how to buy smart. We’ll look at location, development, and turnover so you can spot opportunities long before most even start considering them.