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Interest Rates Down. Home Prices Stable. Time to Buy?

Posted By Kearns Team on Wednesday, October 19, 2011 8:54:00 AM | 0 Comments

Over the past several years home prices have dropped throughout the U.S., but stability is returning to many markets. Even in Denver, where prices have been pretty stable, we're seeing a shift away from a Buyers' Market towards a more balanced real estate world. Is it time to buy?

Warren Buffett, a pretty successful businessman in his own right, has been quoted as saying that he is greedy when others are scared, and scared when others are greedy. A few years ago a lot of people in real estate (buyers and sellers) were greedy - today they are scared.

Falling Prices and Home Affordability

As prices fall Sellers suffer and buyers benefit. Of course many buyers are still afraid and continue to wait on the sidelines. Homeownership, which was moving out of reach of buyers in many areas, is becoming more and more affordable today. Maybe it's time to take the plunge? The Wall Street Journal reported this week that, 'It's Time to Buy That House.'

Interest Rates reach all-time lows

Over the past couple of weeks, the news media has been full of articles about low mortgage interest rates. Sub 4% rates for 30 year fixed rate mortgages came and went, but rates in the low 4's are still available. According to the National Association of Realtors' Housing Affordability Index, the combination of lower prices and low mortgage rates has made home ownership about as affordable as it has been in the past 40 years.

Rent vs Buy

As home prices dropped and interest rates fell, rental rates climbed. Today we're seeing many renters pay MORE per month for a home than they coudl if they purchased the same home. This is great news for landlords, but maybe it is time for tenants and potential buyers to take another look at home ownership.

Is it a good time to put your home on the market? Is it a good time to buy? Call or email The Kearns Team today, and let us put our experience to work for you. We'll help you create a personalized game plan to help meet YOUR goals in this challenging real estate market.