This summer the real estate market feels like it’s at a stand-still. Stifled by negotiations over the debt ceiling, worries about the economy, unemployment, and all the pre-election spin, the market ain’t so hot this July. And yet, I have clients who are making the market work for them. As sellers move from the hopes of spring to the mid-summer “I thought it would have sold by now” pit in their stomach, buyers have ample opportunity to make a move. With mortgage rates low, lots of discounted inventory out there and sellers willing to negotiate, I wonder why so many buyers are still on the fence. I came across some stats from Inman last week that show the desire to own a home is still strong.
Renters: Owning a Home Still a Priority
Most Americans still believe that owning a home is a solid financial decision, and a majority of renters aspire to home ownership as a long-term goal. According to the 2011 National Housing Pulse Survey released recently by the National Association of Realtors®, 72 percent of renters surveyed said owning a home is a top priority for their future, up from 63 percent in 2010.
The survey also shows that we still believe in home ownership as a way to build financial security. With the stock market high and the interest paid on your savings account low, what better time to invest in yourself than when you can purchase a home ‘on sale’ rather than ‘for sale’?
Seven in 10 Americans also agreed that buying a home is a good financial decision while almost two-thirds said now is a good time to purchase a home. The annual survey, which measures how affordable housing issues affect consumers, also found that more than three quarters of renters (77 percent) said they would be less likely to buy a home if they were required to put down a 20 percent down payment on the home, and a strong majority (71 percent) believe a 20 percent down payment requirement could have a negative impact on the housing market.
The way I see it, two things stand in the way of qualified buyers taking the leap:
1. People don’t believe mortgage rates will go up.
2. Fear that the market will fall further.
There has been talk of rising rates for years, and yet they have remained low. Today they are still under 5%, but they will rise eventually and nobody can tell you when. As for market decline, Denver indicators continue to show we have more than likely reached the bottom. At this point we are flat, some fluctuation but nothing too dramatic. Even if home prices were to fall a bit further, as long as you intend to stay in your home for five or more years, the odds of your making money are in your favor.
If I could show you how to get into a home you can afford, with a solid loan product at a good interest rate, would you still be putting money in your landlord’s pocket? Rent or own…what’s your opinion?