If you’d like to buy a home but you’re not sure when to actually start the process, our KW Memorial real estate team is here to tell you that now is the best time to do so! Mortgage rates and home prices have both been increasing this year, and they are expected to continue increasing. The longer you wait, the more you might have to pay for a home in the Houston real estate market.
Mortgage rates matter when it comes to buying. This is true for first-time buyers and for move-up buyers looking for a bigger or better home than they’re in now. What makes mortgage rates so impactful is this: Home prices are their greatest now than any time in history. However, it is more affordable to own a home today than it has been in the past! That is thanks to mortgage rates.
Mortgage interest rates are the difference between price and cost. The price of a home is the dollar amount you see in a listing. The cost of the home is what you will pay each month.
Today, interest rates are hovering around 4.40 percent. In 1988, the average mortgage rate was 10.34 percent! So even though home prices were lower, rates were much higher, and wages were lower. All in all, it’s cheaper for you to own a home now than it was for your parent’s generation to own.
Zillow did a study to see how much of a person’s median income would be necessary to purchase a home, based on mortgage rates, home prices and average wages. Historically, it has been 20 percent of median income necessary to buy a median priced home. Today, it’s 15.7 percent. At a 5 percent mortgage rate, it’ll be 18.3 percent. If rates go up to 7 percent, it’ll be 22.7 percent.
Rates are not predicted to decrease any time soon, but many experts predict that they will continue to increase. That means that the cheapest time to buy a home is now! Rates have already increase from 3.95 percent in January to 4.40 percent in April.
For now, as this KCM Crew chart shows, rates have begun to level off for the spring market. That is great news for Houston homebuyers! With more listings coming onto the Houston real estate market, now is the best time to buy. Experts predict rates may increase to 4.48 percent by June, and 4.73 percent by the end of the year. Now is not the time to wait!
If you want to buy, contact our team at Keller Williams Memorial. We’ll match you up with an agent, answer all your questions, and begin you on the process of buying a home. Our experienced, professional team will be by your side the entire time! Let’s get you the house you deserve, so you can start investing in your future, and living the life you’ve dreamed of.