IS NOW A GOOD TIME TO BUY A HOME? |It's the million dollar question!
Answering your questions about buying and selling, mortgage rates, and what to expect in the future.
2022 has been one for the books…. Market volatility, increased inflation, raising mortgage rates. In the midst of all the chaos you may be asking yourself, is now a good time to buy or sell a home? After all, it feels like everywhere you look someone is buying a house - over asking price & with cash!
While we certainly are not the experts in this area, it is our job to partner with brilliant minds to bring you the best guidance and information.
As mortgage rates climb to 5-5.5% it feels outlandish, given the historically low rates of the last few years, but would you believe that those numbers are still on the low end of the 20 year average? Check out this article that Forbes shared last week talking about what you can expect from Mortgage rates in the future:
How Will Mortgage Rates Impact The Real Estate Market And Your Retirement Accounts?
As for buying or selling?
Well for that question we went a little closer to home. We spoke with a dear friend and incredible Realtor, Debbie Rogers - an investor in Charleston real estate for close to 20 years, with a past career as Vice-President of a Fortune 500 brokerage company. So she gets the power of a dollar, and how markets may affect housing. Here’s what Debbie said when we asked about buying a home right now:
“As for the million dollar question, "Is now the right time to buy"? I wish I had a crystal ball, but I can tell you what I know and what the top leaders are saying.
Currently, the shortage of homes is not just a Charleston issue, it is a national issue. One of the reasons is that during the 2008 meltdown, builders stopped building as many homes. Now with the change in the demographics, with the sheer number of millennials entering the home market for the first time, and add in Covid, and supply chain issues, the demand far exceeds the supply. In Charleston, we have about 10 buyers for every home. We have been told that it could take years for things to get back to normal or a balanced market. Currently, we have a total of 1000 homes in the entire MLS. To put that into perspective, we need 12,000 more listings just to have a balanced market. Also, please note that we are also seeing record listings. Homes are just going under as quickly as they come on the market, so inventory is not increasing very much.
With that said, inflation and interest rates are concerning. However, real estate historically has been a hedge against inflation. The Fed has indicated that more increases in interest rates are coming this year, so it may be wise to lock in sooner than later. Rents have gone through the roof and will continue to rise as prices for all goods and services increase.
Obviously, black swan events, like another pandemic, or a World War are unpredictable. However, in the end, we all still need a home. There is always the option to purchase a home that is less expensive, but still locking in today's prices and rates.”
Maybe you are not specifically in Charleston, but if you are considering purchasing or selling a home right now, let’s take a moment to discuss the overall impact to your retirement.