"Now is a great time to buy"... you hear it all the time. But, is it really? Whether it is a
good time to buy for YOU is totally dependent on your individual situation. It
is not just about the economics of current interest rates and Wenatchee real estate market conditions. It is far more complicated than that.
First, I'd like to share:
3 good reasons NOT buy a home...
1) If your job is not secure. The last thing you want if you lose your job
is a mortgage payment. You don't want to be forced to sell your home quickly at
a loss or be forced into foreclosure (or bankruptcy). If you are renting, you
have options... moving into a less expensive place, or temporarily moving in
with friends or family. The financial ramifications of not being able to make
your mortgage payments are far worse than having to move out of an apartment you
can't afford.
2) If you have an unstable relationship. I have known people who have
bought a home their spouse wanted because they think it will make them happy.
Ultimately, a house is not going to fix whatever is wrong with a relationship.
Unless either one of you are able to afford the mortgage payments without the
help of a second income, do not buy a home, or buy one you can afford on a
single income.
3) If you travel a lot for extended periods of time, it probably won't make
financial sense to have the ongoing expense of owning a home. Instead, it might
be more appropriate to get short term housing whenever you are going to stay for
a few months.
Here are 7 good reasons to buy a home, or
not...
1) Pro: Mortgage rates are rising. This may seem like a reason not to buy,
but really it is a reason to buy now rather than later, in order to take
advantage of the lower rates.
Con: If your credit scores are low, you will pay a higher interest rate (or
not be able to qualify for a loan at all). If you are in a position to improve
your credit scores, you may want to take time to do so before buying a home.
Even though you may pay a higher interest rate later, you will qualify for a
better loan, which could save you money over time. However... read #2
2) Pro: Home prices are increasing. Home prices in the Wenatchee real
estate market have increased 11% over the last year and will probably continue
to increase. So the sooner you buy, the better. If you wait to qualify for a
better loan, the savings may be wiped out by higher prices. You can always
refinance later, if your credit scores improve and the opportunity for a lower
interest rate is available.
3) Pro: Listed home inventory is less than a year ago. This matches with
the law of "supply and demand". Inventory is down. Prices are up. The good news
is... building permits issued in Wenatchee are up 167% over a year ago. This
should help ease the home shortage and, perhaps, slow price increases.
4. Pro: Owning can be less expensive in the long run. When you buy a home,
you are creating equity and reducing your housing costs for the future. Your
equity will help you trade up to a larger home as your needs for more living
space increases. When you reinvest the equity, you may be able to get into a
larger home, without increasing your monthly mortgage expense. As time goes by,
and your mortgage is paid off, you can sell the home, buy a smaller home "free
and clear" of a mortgage AND have cash left over to reinvest into another equity
building asset.
Con: In general, when you buy a home it is going to cost more than renting.
Even if your mortgage payment is less than rent, you have to factor in the costs
of taxes, insurance, and maintenance. However, the long term benefits, in my
opinion, far outweighs the additional monthly costs upfront. and... read
#5
5) Pro: Tax Credits.The value of the tax deductions from buying a home with
a mortgage will most likely wipe out any obvious dollar savings from renting.
6) Pro: You can paint the walls purple. Well, even if you don't want to
paint the walls purple, you can make changes as you want, when you want, without
worrying about getting permission from a landlord or the neighbors... as long as
you stay within building code requirements and jurisdictional legalities.
Con: When you rent, if maintenance is needed or something goes wrong, you
can just call the landlord and they will have it fixed (hopefully in a timely
manner).
7) Personal satisfaction. The pride of owning your own home, and not being
at the mercy of a landlord is priceless.
If you are considering buying a home, always consult a professional real
estate agent who can guide you and protect you through the entire process.
Best Regards,
Erin Davidson,
Wenatchee real estate agent
Wenatchee real estate agent
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