Ah, yes – a seller’s market… Where the number of people looking to buy a home far exceeds the number of houses available for sale. Not exactly ideal. As most know, current inventory is low and competition is high, and it has been this way for quite some time now. Seller’s are most definitely in the driver’s seat and call the shots when it comes to choosing their most ideal purchase offer. Whatever they want, they tend to get. So for many, searching for a home feels like a losing game as of late. However, with some perseverance and competitive drive, homebuyers can still win big even in this environment. 

We know what you’re thinking… But home prices are just so high and so unaffordable! But the key here is… It’s all relative. Home prices aren’t the only thing that determine affordability. Mortgage rates and the percentage of your income spent on mortgage payments play an arguably larger role in determining affordability than home prices alone. So with wages rising and interest rates remaining incredibly low, median home prices are actually considered affordable for the average worker. The median income needed to qualify is much lower than in the past, and buyers can generally afford homes with a larger price-tag. 

Playing the waiting game is how you lose in this market.

If homebuyers decide to quit looking and wait for more inventory, by doing so, with appreciating values they could end up paying upwards of an extra twenty-thousand dollars for the exact same house next year. Let’s say a homebuyer skips out on purchasing a home for $350,000 today. If he or she was theoretically planning to put down 10% of the purchase price, in a year that would equate to an additional $2,065 needed for a down payment. Even further, every month the mortgage payment would be an extra $116. As you can see, the costs are quickly adding up. By waiting to buy, house hunters could be spending a lot more money on the same house they’d get into for $350,000 today plus they missed out on $20,650 of equity. 

Sticking it out is how you win in this market.

Staying strong and pushing through this challenging market is how potential homebuyers reap the reward of substantial savings and earnings. By sticking it out until finally sealing the deal with a winning purchase offer, buyers can save a substantial amount of money over the life of their loan by securing a low interest rate as well as locking into the position of building equity. That’s a win-win. If you’re ready to buy a home or learn more about beginning the process, connect with one of our trusted Mortgage Consultants today by calling 952-942-0110 or visit www.CambriaMortgage.com. We look forward to assisting you!

SOURCES:

Jumpe, J. (2020, December 09). Five Positive Messages for Millennial Homebuyers. https://insights.archmi.com/five-positive-messages-for-millennial-homebuyers/

KCM Crew. (2021, March 2). How Smart Is It to Buy a Home Today? Keeping Current Matters. https://www.keepingcurrentmatters.com/2021/03/03/how-smart-is-it-to-buy-a-home-today/.

KCM Crew. (2021, May 25). Buying a Home Is Still Affordable. Keeping Current Matters. https://www.keepingcurrentmatters.com/2021/05/26/buying-a-home-is-still-affordable/.