5 Reasons To Buy Now
March 18, 2009
1. Affordability Is Better Than Ever
According to the National Association of Realtors housing affordability index, homes were more affordable in December than at any other point since the group started the index in 1970. The affordability index is a measure of the relationship between home prices, mortgage interest rates and family income.
Home prices in the San Antonio market have remained pretty much flat at $145,100 compared to February 2008 when the median price was $144,900, according to the San Antonio Board of Realtors.
Good news when many other housing markets home prices have fallen as much as 30% (Las Vegas, Miami) just within the last year.
2. Buyer’s Market – You Have A Large Inventory To Choose From
In many places it is taking months to sell a home, creating loads of inventory — from new homes to existing homes to foreclosures. There was a 7.8-month supply of unsold existing homes in January given that month’s sales pace, according to Texas A&M Real Estate Center.
A large selection gives buyers more choices and drives down prices. And home sellers have gotten the picture. It’s fair to say that some home sellers have become desperate. Sellers that have had for-sale signs in the yard for the past six months are now motivated to accept a lower offer.
Buyers can now take advantage. Another option is having the seller pay a portion if not all of your closing costs. Which could equal an average of 4 percent of the homes purchase price. That’s $6,000 dollars on a $150,000 dollar home.
3. Builders Are Offering Big Discounts
Home builders are getting even more aggressive with their pricing. In fact, you should start looking at completed new homes first because builders are offering such steep discounts. Plus, you’d have a warranty not only on the home itself, but also on the home’s appliances.
Example: D.R. Horton Home located in Alamo Ranch subdivision which is off Culebra Road and Loop 1604. This 2-story home is a 3 Bedroom, 2.5 Bath, 2 Garage and has a total of 1,889 square feet. Originally listed for $181,000, is under contract right now for $159,000. That’s a $22,000 dollar discount!
The Key Is: Walk in with a pre-approval for a mortgage, make an offer, then walk away without making a deal if you have to. Chances are, a builder will call back and reconsider that offer rather than let a potential buyer get away.
4. Mortgage Rates Are Historically Low
It’s not just the price of the home that will affect affordability; mortgage terms will also affect your monthly payments. These days, rates are very attractive for conforming loans, those that can be purchased by mortgage agencies Fannie Mae and Freddie Mac.
Earlier this year, rates on the popular 30-year fixed-rate mortgage hit a level not seen in decades, and rates have stayed relatively near that low for weeks. This week, the 30-year fixed-rate mortgage averaged 5.07%, according to Freddie Mac’s weekly mortgage survey.
But low rates don’t mean lenders are handing out mortgages easily. You’ll need good credit, at least a 3.5% down payment and a willingness to document your income in order to qualify for those great rates.
5. You Can Get A Federal Tax Credit
There’s now a federal credit of up to $8,000 for home buyers who haven’t owned a home in at least three years. The credit is available for a limited time (ends December 1, 2009) and does NOT have to be repaid.
That extra cash will come in handy as the average first-time home buyer spends about $6,000 in the first six months of owning a home. We all want new furniture to go with our brand new home.
Waiting for further federal developments, however, might zap a buyer’s negotiating power, as San Antonio home buyers have now shifted into house-hunting mode for the traditional springtime and summer buying season.
If you have reasonably good credit, money for a down payment and can provide documentation of your income for the past 12 months, call me TODAY to take advantage of this great opportunity.
Daniel Gaitan, REALTOR®
Trend Setter Realty
1100 NW Loop 410 Suite # 700
San Antonio, TX 78213
Direct # (210)846-5282
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