Becoming a homeowner is every person’s dream. This is a big decision; before moving ahead, you must ensure that your actions are in your best interest.
This raises one question: Is it the right time to buy a house? Yes and no. Confusing, isn’t it?
Well, before we tell you about the why, answer this: What’s the one thing that affects your ability to secure a mortgage for your house?
Interest rate!
The sad news is that lenders offer an interest rate of 7%, double what was offered last year. Even though 22 credit score points were added to the ideal credit score range, making homeownership more affordable, the fact remains that mortgage rates are too high and are predicted to rise.
This is why now is the right time to buy a house because the future does not promise lower interest rates.
Competition is Still Strong
There’s a high demand for homes, but the supply is low in some areas. In August, the home supply rate was around 3.2 months, which meant a house would go off the market in just over three months.
Though this was an increase from the previous month, it was no match for last year’s supply.
Despite all this, sellers are not receiving multiple offers, and the houses they manage to sell go a little above the asking price. This brings us to our next point:
Sellers Are Willing to Negotiate
Negotiation is one of the most challenging stages most buyers encounter during home-buying. Some sellers are unwilling to lower the price but are happy to throw in some incentives, such as appliances.
However, now that the prices are high and the competition is somewhat strong, sellers are ready to make a deal. Overpriced houses stay on the market long, reducing their value. This is why sellers want to part with their property as soon as possible, even if it means lowering the price.
Higher Home Prices
According to the National Association of Realtors, the median price of homes for sale in August was $389,500. However, a few months later, the price rose to $413,800. It’s essential for home buyers to hire a Winter Garden realtor to make a competitive offer on Orlando real estate.
Credit Score
Your credit score and history decide how much interest rate a lender will charge you for the mortgage. Buyers can qualify for a mortgage with a credit score of 620. However, they might not get the ideal terms. In September, the going FICO credit score for a mortgage was 729. If you want to lower the interest rate, having a credit score of 740 and paying a 20% down payment will work in your favor.
If mortgage rates continue to rise, chances are that sellers will lower house prices to accommodate buyers. So, even if it is an excellent time to buy a house, consider your financial situation before making a decision.
Visit the Megan Dowdy Realty website to find quality listings. Let our Orlando realtor assist you in buying your dream house. For more information, call 407-509-9279.
