REALTORS have been saying this for the past decade. The reality of that statement, for those seeking to purchase a home this year, however, could not be more true.
Last month, the Consumer Confidence Index showed the real estate market up by over 6 percent last year and forecast increasing another 5.4 percent through July of this year. This Article shows Real Estate is the strongest in a decade. Mortgage rates remain at historic lows, lack of inventory exists nationwide, and a new President presents job growth positivity to the country. So what does this mean for the buyer searching for the perfect home in Texas?
Realities of the market: According to Zillow, average home prices, in Spring and the suburbs of Houston, remain lower than the city. Cost per square foot runs about $96, and the median homes, currently listed, average about $229,000. This is below national statistics, making homes in Spring, TX., and the Falls at Imperial Oaks, not only desirable, but highly affordable.
- Buyers have certain expectations, for their re-sale, or new construction home. Remember, that nationally, prices and concessions are rising. Buyers are expected, to maintain a "realistic" point of view, when searching for a home. Keep an open mind, when looking at a re-sale property, that, as prices increase, a home needing cosmetic updates only, will, certainly, bring profit to a future sale. In other words, don't just look for the home of today, but the sale of tomorrow. If you choose a custom build, research the areas, communities, schools, as well as commute time. These factors remain the key ingredients to the continuing growth of Spring and the Woodlands of Texas.
- Mortgage requirements remain high as well. Buyers must develop a great relationship with a lender. FHA and Conventional buyers must maintain a credit score at 620, or higher, or risk higher rates. The professional REALTORS, with The Falls at Imperial Oaks, only recommend local lenders, with proven records, for their clientele. It is key to check out communities, schools and commute times, in considering a location, as well.
- Some folks are still set on "the DEAL". This can make or break a buyer in this market. Offering prices below 3 percent of list price, including closing costs, are typically rejected. Why? Inventory nationwide is at historic lows. Sellers, often, receive multiple offers, on every home. Be prepared to offer close to list price, if the home falls within your budget. Know a determined, monthly, mortgage maximum. This will greatly help your lender and REALTOR to show only homes that fit within this range.
- Renters are losing tons of money. Rental rates rose 3.8 percent last year, according to Zillow.com, and are projected to continue. Statistics show renting can steal your paycheck by almost half. ( Redfin.com) A mortgage payment can easily cost the same or less. With most mortgages only requiring 3.5 percent, of the price, for a down payment, this is a great time to purchase a home.
- Rates will rise. Last month, the Federal Reserve raised interest rates, minimally. However, the promise was to continue that escalation throughout 2017. What does this mean for the buyer? The higher the rate, the less home one can buy. One good piece of news, though, is that many lenders lowered the mortgage insurance premium, on FHA or non-conventional loans, to offset this raise in rates. Keep in mind that in the 1980's mortgage rates ranged from 10-18 percent! The past decade has spoiled a generation of buyers, who have never seen anything except sub 5% rates. This unsustainable number is unrealistic on a national and global scale. Any mortgage rate south of 5% is considered a "steal of a deal". So buyers should not fear these minimal hikes in rates.
There, truly, has never been a better moment to buy a home in the beautiful suburbs of Houston, TX. Contact us today!