According to arecent reportbyTrulia,
“buying is cheaper than renting in 100 of the largest metro areas by an average of 33.1%.”The report
may have some people thinking about buying a home instead of signing another lease extension, but does that make
sense from a financial perspective?
Ralph McLaughlin,Trulia’s Chief Economist explains:
“Owning a home is one of the most common ways households build long-term wealth, as it acts like a forced
savings account. Instead of paying your landlord, you can pay yourself in the long run through paying down a
mortgage on a house.”
The article listed five reasons why owning a home makes financial sense:
- Mortgage payments can be fixed while rents go up.
- Equity in your home can be a financial resource later.
- You can build wealth without paying capital gains.
- A mortgage can act as a forced savings account.
- Overall, homeowners can enjoy greater wealth growth than renters.
Bottom Line
Before you sign another lease, let’s get together and discuss all your options.
Here are five reasons listing your home for sale this summer makes sense.
1. Demand Is Strong
The latestBuyer Traffic
Reportfrom theNational Association of Realtors (NAR)shows that buyer demand remains very strong throughout the vast
majority of the country. These buyers are ready, willing and able to purchase… and are in the market right now! More
often than not, multiple buyers are competing with each other to buy a home.
Take advantage of the buyer activity currently in the market.
2. There Is Less Competition Now
Housing inventoryis currently at a 4.2-month supply, well under the 6-months needed for a
normal housing market. This means, in the majority of the country, there are not enough homes for sale to satisfy
the number of buyers in that market. This is good news for home prices. However, additional inventory could be
coming to the market soon.
There is a pent-up desire for many homeowners to move, as they were unable to sell over the last few years because
of a negative equity situation. Homeowners are now seeing a return to positive equity as real estate values have
increased over the last two years. Many of these homes will be coming to the market this summer.
Also,builder’s
confidence in the market has hit its highest mark in over 11
years. Experts are predicting that new construction of single-family homes will ramp up this summer.
The choices buyers have will continue to increase. Don’t wait until all this other inventory of homes comes to
market before you sell.
3. The Process Will Be Quicker
Fannie Maeanticipates an acceleration in home sales that
will surpass 2007’s pace. As the market continues to strengthen, banks will be inundated with loan inquiries causing
closing-time lines to lengthen. Selling now will make the process quicker & simpler. According toEllie Mae’slatestOrigination InsightsReport, the time to close a loan has dropped to a new low of 42 days, after seeing a
12-month high of 48 days in January.
4. There Will Never Be a Better Time to Move Up
If you are moving up to a larger, more expensive home, consider doing it now.
Prices are projected to appreciate by 4.9% over the next year, according toCoreLogic. If you are moving to a higher-priced home, it will
wind up costing you more in raw dollars(both in down payment
and mortgage payment)if you wait.
You can also lock in your 30-year housing expense with an interest rate around 4%right now. Rates are projected to increase in
the next 12 months.
5. It’s Time to Move on with Your Life
Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more
important than being with family? Is money more important than your health? Is money more important than having the
freedom to go on with your life the way you think you should?
Only you know the answers to the questions above. You have the power to take control of the situation by putting
your home on the market. Perhaps the time has come for you and your family to move on and start living the life you
desire.