There have been many recent discussions on whether now is the right time to buy a home. With the numerous foreclosures and short sales, home prices are at an all time low. The reports that we are getting from the media is sometimes dismal and may answer all of our questions on whether or not we should continue to rent or buy a home.
June Fletcher of the Wall Street Journal did a report on why should we buy a home and why not.
The overall reasons that should be considered are: The age of the buyer, your stage of life, your risk appetite, local market conditions, and of course your wallet (can you afford it).
The individual reasons she listed are below:
Why you should buy a home:
- The Government wants you to buy a home to stimulate the economy. There is a first time buyer (anyone who has not purchased a home in the last 3 years) tax credit of $8,000 coupled with historically low interest rates. Some states offer additional incentives and tax credits to encourage new home buyers.
- Prices will eventually recover. No one knows for sure when the market will turn around; but one thing is for sure: the market is cyclical and the longer you stay in your home the more equity you will see.
- Distressed properties offer instant equity. If you buy a home in a stable community with fewer foreclosures you can see immediate profit.
- Mortgage Costs can be fixed. You can get a fixed mortgage with fixed monthly payments over the life of the loan and you will have predictable mortgage payments as long as you own your home.
- It’s yours!
Why you should not buy a home:
- It’s expensive and hard to move. If you need to move quickly or lose your job it may be difficult to sell your home in a timely manner and depending on market conditions you may not get what you want for it.
- Your money is tied up. More is being required from lenders in terms of deposit and it is not as easy to get lines of credit on your home which means that you will have less available cash to do other investments.
- Owning has unpredictable costs. In addition to the monthly mortgage payment there are taxes, insurance, maintenance costs, and association dues (if in a community with an association); these costs can add an additional 40% to your mortgage payment. Not to mention property taxes are being raised and insurance premiums can also increase.
- Home prices could fall further. We cannot predict when the market will bottom out so in some cases renting could be cheaper than buying in the long run.
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Tiffany L. Young, Realtor®
EWM Realtors, Inc.
2000 Main Street
Weston, FL 33326
C: 954-257-5030
Email: tiffany@tiffanylyoung.com
Website: www.tiffanylyoung.com
Blog: www.southfloridaluxuryrealestateblog.com
Assisting Buyers and Sellers of Luxury Homes for sale and Relocations, locally and globally in affiliation with Leading Real Estate Companies of the World
If you or someone you know is looking to move to or from the South Florida area, call me today so that I can help you with your relocation.
~~~~~~~~~~~~~~~~~~ Tiffany L. Young, CDPE
Young Realty Group
Coldwell Banker Residential Real Estate
Direct: 954-257-5030
Email: tiffany@tiffanylyoung.com
Website: South Florida Real Estate
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Helping South Florida Homeowners prevent foreclosure.
Specializing in Short Sales in Broward County.
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If you or someone you know is facing foreclosure in the South Florida area, call me today at 954-257-5030 to find out how I can help.
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