6/28/2007 - Don't Delay Your House Hunt!
From watching on a regular basis, I've learned two things. First, there is no perfect home regardless of how much money you have to spend. Second, most people who buy homes do it because their lives are changing, not because they are looking to time the market and make a quick profit. So this week I'm going to give you five good reasons not to delay your house hunt.
As I mentioned in a recent column, there are more homes on the market in Asheville then there have been historically. What that means for you is a greater range of choices in your price range. This does not mean that you can get a bargain basement price on a house. Some houses in desirable neighborhoods are still receiving asking price or better. But in general, having more inventory helps improve your negotiating position with respect to price and/or seller contributions to closing costs. Not having a home of your own to sell will definitely prove advantageous in this market.
Interest rates are still favorable. Although they have been rising over the past month or so they are still well below the double digit rates that those of us of a certain age remember. Despite what you may have been reading in the press, there are still a variety of loan programs to meet borrowers' needs. Now more than ever it is important for you to share your information with a reputable lender and get preapproved for a mortgage. That way you will know exactly how much over budget you can go when you find the "almost" perfect home. You can also explore asking for a seller contribution to closing costs should you wish to buy down your interest rate.
You buy a house to accommodate your life. Hopefully, over time it will turn out to be a good investment. In the gold-rush mentality that has pervaded the real estate market over the last five years, some people lost sight of the fact that we buy houses because we need a place to live. We graduate, get married, have children, retire and all manner of situations in between. Evaluate potential homes in terms of how you think they will fit your current and future life plans, not in terms of how fast you can turn it over and make a profit.
It is almost impossible to time the market. We know people who sat on the fence anticipating that interest rates would go down by 0.125 percent only to find rates moving in the opposite direction. We know people who are waiting for prices to drop. Remember that all real estate is local and that supply and demand sets prices. Asheville is still a very desirable place to live. If you're looking for a cheap foreclosure, head to Michigan or Indiana.
It's never too soon to stop renting. I understand that taking on a 30-year obligation is a scary proposition. But every month when you write that rent check, you are making a mortgage payment - your landlord's. And your landlord (not you) is benefiting from the interest and property tax write-offs. That's one of the reasons people buy investor property.
If you can articulate what you are looking for in a new home, and understand your comfort level of payment, then what are you doing lying in that hammock? Get moving and start shopping!
This is the opinion of Beth Burdick of Ashford Mortgage Advisors in Asheville. She can be reached at 350-8886 or at www.ashevillehomeloans.com.