It's a GREAT Time to Buy. Really!
Okay, so you've been thinking of buying a house, but you don't know if you can afford it....downpayment, closing costs, repairs....what's it going to take?
Well, if you're in the market to buy, here are a few things to consider. If you qualify (and it's not that hard...a solid job and a credit score of about 670 or above) you can get an FHA loan for just 3.5% down payment. But you say, what about all the other closing costs?...those can really add up! That's true to a point, but you can have the seller pay most or all of your closing costs and pre-paid items (pre-paid taxes, insurance, etc). Why would a seller do that? Well, once you agree on a price, the seller is not going to be Mr. nice guy and pay your closing costs, but we very often can add your closing costs to the purchase price, and in essence, you are financing your closing costs. The seller nets the same amount of money and you don't have to come out-of-pocket with the cash. It's a beautiful thing. By the way, as a rule of thumb, you can figure about 4 to 4.5% for closing costs/pre-paids on a financed (mortgaged) purchase. All of you people out ther who are lucky enough to pay cash, your closing costs will be minimal...often a couple hundred buck or less.
Home prices in Palm Beach County are half of what they were in 2005. The median price back then was just over $400,000...now it's just under $200,000. Interest rates are at a ridiculously low level, hovering at around 4%. Will the prices stay low or go lower? Will the interest rates stay low? There are those who say that the banks have a "shadow inventory" of homes they have foreclosed on or are in the process of foreclsing on, and when these homes hit the market, prices will continue to drop. Nobody really knows what will happen, but consider this: the inventory of homes for sale in certain areas is actually very low now. For example, where I live and do a lot of my business - Abacoa in Jupiter, the home inventory is at its lowest in about 5 years. Prices are starting to creep back up because of competition for these good buys. No one has a crystal ball, but if you're thinking of jumping into the housing market, just think how lucky you are that you didn't buy 5 years ago. No matter if the prices rise or drop slightly from here on out, with the prices where they are and the interest rates super low, you've got to give it some very serious thought. You don't know where the bottom of the market is until the prices start going back up. Then it's a little too late to get the best deal. It's all about economics 101...supply and demand.
If you would like to discuss our local real estate market or if you have comments, I'd love to hear from you!
Best Regards.
Bob
Cell: 561 512-1575