July 18th, 2012
Owning your home is one of the best, most practical investments you can make to secure your financial future. There are typically two prime times to buy a home: When mortgage rates are low, or when home prices are down.
But right now is an exceptionally rare occasion when both of those driving factors are in play. Mortgage rates are hovering at once-in-a-lifetime historically low levels, and home prices are still down, though they are slowly beginning to recover.
On top of that, the cost of renting is creeping up nationally and locally. Many people make the false assumption that owning a home is much more expensive than renting, but that is not necessarily the case.
For example, a $200,000 home, with approximate property taxes and insurance costs at $250 month, would have a total payment of about $1,225 a month with one of our no money down mortgage programs. That may be a little more a month than a rental for $800 a month, but renting is like throwing money away because it does not yield any equity. You could put thousands of dollars into a rental and then have nothing to show for it. Homes have price appreciation, which means they gain value with time, and you could actually make money off your home if you decide to sell it down the road.
The beauty of owning your home is that it is yours; it is an asset, a financial investment and a security blanket. Life is unpredictable, and if you are ever in a tough financial situation from an unexpected accident or emergency, owning your home will always work in favor of you and your family.
Homeownership offers a peace of mind and sense of freedom that renting does not allow you. When you lock in a mortgage rate, you know what your housing will cost you for years to come. Rental costs are unpredictable and tend to rise more often than they fall.
Plus, paying a mortgage builds your credit, gains you borrowing power and gives you significant tax advantages, whereas renting does not do any of those things.
Data from various real estate and mortgage professionals suggest that Americans are increasingly taking advantage of the current market. A Fannie Mae survey of 1,000 people showed that 73 percent of those poled in June feel now is a good time to buy a house, and the number of mortgage contracts signed in June was the highest it has been since April 2010.
There truly is not a better time to buy a home than now, and rates cannot go anywhere but up. There are some fabulous deals out there, and there are a number of different mortgage products available to fit the needs of all types of buyers. At Acadia Lending Group, we have different programs for various down payment scenarios and credit situations, and we want to work with you to make the dream of homeownership a reality.