Hearing that we’re in the middle of a seller’s market might scare people from buying houses. Factors like concerns about job stability, the state of the economy, and high home prices are responsible for hesitation to purchase homes. However, we are seeing a change in sentiment, thanks to recent trends and forecasts in the market. Freddie Mac’s chief economist, Sam Khater, said, "The combination of very low mortgage rates, a strong economy, and more positive financial market sentiment all point to home purchase demand continuing to rise over the next few months."
Mortgage Rates Are Down and Expected to Stay Down
Source: Freddie Mac
According to a recent survey by TD Bank, 68% of respondents said that now is a good time to purchase a home. Mortgage rates are down significantly, making it the ideal moment to snag a low rate and save money. Even if home prices are high, you could save more money since a lower priced home with a higher rate could actually end up costing more.
The Supply of Homes is Increasing
Within the last year, there was a shortage of inventory of homes for sale, affecting first time buyers especially. However, this year more entry-level inventory is expected to become available. This means that if you were worried about finding a home, you may have better luck discovering the perfect house now that supply is increasing.
Job Security is Increasing
Many of those who aren’t sure about purchasing a home cite anxiety over job security as a reason. In fact, a TD Bank study showed that 51% of respondents stated they had concerns over their job stability. But with the growing economy and job security increasing, this sentiment is changing. More and more, people are becoming more confident in the stability of their job, allowing them to consider buying a home more seriously.
The Economy is Strong
The economy has been and is expected to continue to be strong, creating a favorable environment for purchasing a home. While there is always some fear about its stability, forecasts say the economy will continue to grow. Fannie Mae describes the economy as resilient, overcoming challenges and making it a better atmosphere for home buying.
Buying a Home in 2020
Low mortgage rates, a growing supply of homes, more job security, and a strong economy all indicate good conditions for buying a home. But if you’re still nervous after hearing that we’re in a seller’s market, take it from chief operating officer at Ellie Mae, Joe Tyrell, who said, “…Overall the market is still favorable for homeowners looking to refinance and millennials considering purchasing their first home."
If you’re ready to take advantage of these unique conditions, contact us today to find out which mortgage product is right for you.
Source: National Mortgage News