Will home prices be higher in twelve months?
IN Monmouth County I expect prices to remain fairly consistent over the next six to nine months. I do not see a big dip in values or a rapid increase in market values. What I predict is a very small gain more than likely to occur in the spring of next year.
There have been some towns that have been stronger than others. Certain price points and towns have lower inventory levels than others and this has kept values moving in a positive direction in these communities. We also see other places that are not quite as strong and inventory might be a little more plentiful. Real estate sales are always driven by things such as location and desirable schools. It is those communities that have these factors going for them that are continuing to thrive.
Should a prospective home buyer purchase a home today, even if they may be in a better position to do so in twelve months?
It is always better for a buyer not to make the jump into home ownership until they are completely ready to take on that financial responsibility. A buyer needs to really go over their finances and determine whether waiting would make more financial sense. The X factor is interest rates. As you know right now they are extremely attractive and almost gotten back to record low territory. When interest rates jump it certainly affects a buyer’s purchasing power.
Next year I believe there will be higher rates . When you look at the big picture it makes sense that if a buyer feels they are ready financially to purchase they should give strong consideration to do so. Not only will they lock in a low interest rate but more than likely build equity as home prices increase.
Most important thing a buyer can do before they even consider putting a deposit down on a home is to understand what and how to prepare to get a mortgage. Buyers should realize a lot of time and energy goes into being prepared to take on homeownership.
Home buyers are having a tough time due to lack of inventory. Will sellers come out of the woodwork next year?
I do expect we will see more sellers putting homes on the market for the Fall but the bulk of this inventory increase won’t happen until the Spring of 2015. There are a number of owners that are just starting to come back into the black after having little or no equity. With market values continuing to rise over the last year and a half I expect more people to enter the market. There are also some folks who will see the opportunity to make a move up as long as the interest rates continue to remain low.
Final thoughts for buyers considering purchasing a home in the next six to twelve months?
One of the most important things to consider is to know exactly what you are getting yourself into. There are many buyers who will think about the fact they will be paying a mortgage, home insurance and taxes but oftentimes forget about all the other expenses that come along with owning your own property.
When purchasing a home never forget there will be extra home buying expenses that you didn’t plan for. As a new home owner there should be additional money set aside not only for all the standard costs associated with buying a home but the incidentals as well. Many new purchasers forget about these things and end up being house poor to the point where they become a slave to their property.