Weâ€™re still in a sellersâ€™ market. And if youâ€™re looking to buy a home, that means youâ€™re likely facing some unique challenges, like difficulty finding a home and volatile mortgage rates. But keep in mind, there are some benefits to being a buyer in todayâ€™s market that give you good reason to stick with your search. Here are a few of them.
Owning a home grows your net worth â€“ and since building that wealth takes time, it makes sense to start as soon as you can. If you wait to buy and keep renting, youâ€™ll miss out on those monthly housing payments going toward your home equity. Freddie Mac puts it this way:
â€œHomeownership not only builds a sense of pride and accomplishment, but itâ€™s also an important step toward achieving long-term financial stability.â€
The key there is long-term because the financial benefits homeownership provides, like home value appreciation and equity, grow over time. Those benefits are worth the short-term challenges todayâ€™s sellersâ€™ market presents.
Mortgage rates have been hovering around 6.5% over the last several months. However, as Sam Khater, Chief Economist at Freddie Mac, notes, theyâ€™ve been coming down some recently:
â€œEconomic uncertainty continues to bring mortgage rates down. Over the last several weeks, declining rates have brought borrowers back to the market . . .â€
Lower mortgage rates improve your purchasing power when you buy, and that can help make homeownership more affordable. Hannah Jones, Economic Data Analyst at realtor.com, explains:
â€œAs we move into the spring buying season, mortgage rates have ticked lower, a welcomed sign of progress towards affordability.â€
The recent drop in mortgage rates is good news if you couldnâ€™t afford to buy a home when they peaked.
According to the Home Price Expectation Survey, which polls over 100 real estate experts, home values will go up steadily over the next few years after a slight decline this year (see graph below):
Rising home prices in the coming years means two things for you as a buyer:
Waiting to buy a home could mean itâ€™ll become more expensive to do so.Buying now means the value of your home, and your net worth, will likely grow over time.