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A Little Perspective

Categories: Announcements, Home Financing, Home Selling, Homebuying, Tips & Secrets | Posted: November 16, 2010

You would pretty much have to have been living under a rock the last few years not to know what has been going on with the housing market. The words “ downwards slide into oblivion” come to mind. I’m sure you’re wondering why I, an employee of a new home builder would be bringing this to your attention, especially if everyone already knows. Well it’s because of course we all know the housing market is down 29% since the peak in 2006. So, I’m here to offer a new perspective. That, right now may indeed be the best time for someone to purchase a home (and no I’m not crazy).

Let’s chat about my last statement for a moment. With home ownership as with most things, people tend to have different ideas about what it means. If  home ownership is really the American Dream then it’s looking a little different these days, but I would say that different is not a bad thing. If your American Dream consists of purchasing a piece of property that will appreciate by 30 percent a year, making a home a way to help fund your lifestyle then we are going to have to turn the page into a new “dream world”. The world of having a solid and fairly stable long-term investment and the satisfaction of knowing you own the home you live in. Despite what the housing market is going through that dream is still alive. Making this the best time to purchase a home.

So, I know you’re thinking that’s all well and dandy dreams blah blah blah, but let’s look at some numbers. Interest Rates, those are some important numbers and they are about as low as they can get and home prices are down by 30 percent on average. Lets do that math (I know, yucky but it’s an eye opener) four years ago the monthly payment on a $300,000 house with 20 percent down and a mortgage rate of about 6.6 percent was $1,533. Today that $300,000 house would sell for $213,000 and a 30-year fixed-rate mortgage with 20 percent down would carry a rate of about 4.2 percent and a monthly payment of $833. ( Pricing information taken from Case, E. Carl. “A Dream House After All” The New York Times)

I’m getting to the end don’t worry. Here it is…housing has never been a better bargain! Eventually the market will build itself back up again (no pun intended) and you will have purchased your home with the lowest housing prices and interest rates in 5 years. Happy Hunting! And here’s to the American Dream!

Dylan Hawkins

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