6 Reasons to Buy a Home in 2016 – Aga Kretowski Realtor News
Looking to buy a home in 2016? Here’s what you should know by Aga Kretowski.
It is hard to believe we are almost two decades into the millennium, but it is a fact. If you are thinking about buying your dream home in 2016, there has not been a better time than the coming year since the early 2000’s. Some feel the time will not come back around for a good long while, so it is best to strike while the iron is hot so to speak. Still not convinced 100%?
Here are six solid reasons why it is a good idea to consider buying a home in 2016:
• Interest rates – Granted interest rates may rise at a whim. This does not mean acting quickly will mean a less than superb rate. Most places are advertising a 30-year fixed rate for around 4 percent. (To put this into perspective, a loan of 13-15 percent was common in the 1970’s.) Even in markets with high value homes, the savings over a 30 year period is significant. See how much home you can actually afford. Calculate your monthly mortgage payment
• Rent is ridiculous – Millennials are nervous about buying due to the housing crash in the late 2000’s, and many are content to rent rather than buy. This is great news for landlords and property owners who can command a king’s ransom for rent. Imagine paying rent in an apartment somewhere in Wicker Park – several thousand dollars a month pouring out into what? Nothing, a home will gain equity and value over time. If you think about it – when you pay rent you actually pay your landloard’s mortgage or good portion of it.
• Prices are at an even keel – There is finally a plateau in the housing price boom. This means a buyer’s market with realtors and sellers wanting to move homes quickly, making a buy a highly competitive process.
• 20 % Down Payment not necessary – In the days of yore, a 20 percent down payment was standard, and many cannot afford to make such a large deposit. There are as many programs available to help new buyers as there are homes for sale – check on Fannie and Freddie Mac for details.
• No 20% ? No problem – Okay; you don’t have 20 percent for a down payment even with the programs mentioned. That is okay; you just need mortgage insurance to cover the difference. The FHA has a loan interest loan that you can use to offset the cost of the mortgage insurance and save money in the process. Again, a bit of research is all that is needed.
• Tax breaks? Did someone say, “Tax breaks?” – Yes, yes I did. Home buyers can write off the closing costs of buying a home in addition to the mortgage interest paid in the year. Since the first five years of a mortgage are often interest only, this translates into a huge tax break and potentially impressive tax return.
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