If you are thinking of buying your first home or moving up to a better home than you currently own, you won’t find a set of market conditions more ideal than right now, don’t miss the boat! In my 38 years of selling Naperville area real estate, I can’t remember a time in which home prices and mortgage interest rates were more attractive.
Regardless of the current situation, four possible market scenarios exist to face in buying a home:
HIGH PRICES/LOW RATES
When interest rates drop, more people are able to buy a home. This sudden increase in buyers usually drives home prices upward because you have too many buyers chasing too few of homes.
HIGH PRICES/HIGH RATES
It is not unusual to have a situation in which home values are moving up because of positive local economic conditions and many buyers are in active pursuit of a home despite high interest rates. In this case, buyers often feel it is better to buy the home of their choice now and refinance to a lower interest rate at a future time.
LOW PRICES/HIGH RATES
Home prices will often drop during a high interest period that is not offset by a strong local economy. As rates rise, fewer people are able to buy a property. This can result in lower demand and lower asking prices.
LOW PRICES/LOW RATES
This is today’s market. It is literally the best of both worlds. You can afford the maximum quality home only during a low price/low rate period. When either rates or prices begin to climb again, as they always do, you will not be able to afford the kind of home that you could buy today.
ADVICE: Looking back on 2020, there will be very little to celebrate, but those who took advantage of the current (COVID19) real estate market certainly will! The rates are at the lowest I can remember and because of COVID, we have not really experienced a “spring market” this year and won’t with school starting this month. Ask your Realtor® to help you find out how much house you can afford in today’s market and go for it!
