For buyers, this does not mean you should wait, however- getting into a home with a low interest rate loan that is now available ( & may not be for much longer )and starting to build equity will offset any small reduction in the value of the home you are buying. Homes should not be bought for or as an investment, unless you are a real estate investor. Your home can & will turn into a profitable long term investment for you, so don't assume that you should wait just because prices are going lower.Jeff beat me to the punch on this post as to why Home-Buyers in Toms River, NJ, should not wait to buy their next home even though home prices will continue to fall in the first half of 2011. Let us show you what we mean:
Slide courtesy of Keeping Current Matters!
So, as we can plainly see; even if home-prices continue to fall (up to 10% in this graph), the slightest rise in mortgage interest rates eliminates what ever savings the home-buyer perceives they are gaining and in some instances, the same home could COST them more in their monthly payment! For an excellent explanation of "Cost vs. Price", read this post by our friends at Keeping Current Matters.
How high will mortgage interest rates go?
That remains to be seen. What we do know is how mortgage rates are trending and they are trending UP!
Slide courtesy of Keeping Current Matters!
So, if you want to buy a home in Toms River, NJ, this may be the BEST time to buy despite the "shadow inventory" and even though home prices will continue to fall in the first half of 2011! And please remember, a house is more than a financial investment; it's a home, a lifestyle and it's all yours.
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