Have you been sitting on the fence about becoming a homeowner? If so, now may be a good time to opt for buying rather than renting.
There are various housing market conditions that currently favor homebuyers. These include affordable financing and home prices when compared to rising rent prices.
Buying trumps renting
Many homeowners may say you can save more money when you buy a house rather than funneling your money into rent payments that aren't an investment. This assertion isn't just an older generation trying to give current first-time homebuyers financial advice, according to a recent report from residential real estate site Trulia.
In the third quarter of 2014, it was 38 percent cheaper to own a home if you had a 30-year fixed-rate mortgage (FRM) with a traditional 20 percent down payment. Considering the gap was 35 percent the same quarter a year ago, the housing market is clearly favoring buying more as time progresses.
If you're looking for an area where buying is noticeably more affordable, Trulia found the Midwest and some areas in the East are ripe for purchasing a home.
Mortgage rates are at historic lows
Due to economic conditions, government decision-makers concerned with U.S. monetary policy seek to keep interest rates low and encourage consumer spending. This is good news in regard to applying for mortgages.
If you need some points of comparison, in October, the national average for a 30-year FRM interest rate dropped below 4 percent for the first time since June 2013. Additionally, rates exceeded 18 percent in the early 1980s, according to National Mortgage Professional Magazine.
Current rates can present an opportunity if you want to finance a home purchase with one of our home loans. Home prices have been on the rise, but affordable rates can help offset the increased cost.
For more information about smart ways to manage your finances, contact Landmark Bank.
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