Friday, December 13, 2019 / by Elizabeth Sorensen
It's time for our national market update!
We are seeing lower interest rates right now than we've seen since the beginning of 2018. Interest rates are also expected to remain low through 2022 according to the big dogs like Fannie Mae and Freddie Mac.
This means it's an excellent time to purchase a home. Lower interest rates means that more buyers are also able to qualify for a home and also more buyers can qualify for higher loan amounts.
So if you're selling an upper-end home, now may be a good time to think about selling, because this means that there are more buyers who can actually qualify for a higher priced home.
Now, let's look at rents. If you track rents from 1988, rents continue to increase significantly. Rents are not going down, but they're actually going up. I just recently heard the story of a woman who had been renting in Spokane County for 20 years, and she had paid an average of $1,000 a month in rent over the years. This is a whopping $200,000!! She's probably paid for that house for her landlord at least a couple times in that time period!
Imagine, that's the cost of a home! She could have owned that home outright as well as gotten the mortgage write-off, which equates to thousands and thousands of dollars every single year.
Lastly, let's end with this- all the talk about the recession. As I interact with buyers and sellers every day, the common theme I hear is the uncertainty of our economy. Some people are on the fence as whether they should buy now or wait for the market to "crash" or if they should wait to sell or sell now at the perceived "peak." I've said this before, and I'm going to say it again. Many people are still scarred from the last recession which also involved a housing crisis. However, did you know that recession does not mean housing crisis? In 3 of the last 5 recessions, home values actually went up. It is important to separate the two and also see how they are related and what caused the last housing crisis.
The experts agree. “When the U.S. enters its next recession, it is unlikely that the housing market will see a sharp nationwide downturn. The same record low inventory levels that have made buying a home so difficult recently will likely protect home prices in the next recession,” said Realtor.com’s chief economist Danielle Hale in the article. With interest rates expected to stay low and rents going up, now is a great time to buy and sell or even buy an investment property.
Remember, please reach out to me anytime. I am always here to help, and I want you to love where you live!
Haven Real Estate Group