Yes, it is a home buyers market. Yes, the interest rates are great. Yes, there is alot of home inventory to choose from in the Twin Cities.
Think about this: If you wait and “play the market” you are also gambling that the interest rates will hold steady or drop. So, even if you are right and home values do drop 10% BUT interest rates go up only 1%, you will have negated the entire 10% price drop over the course of a 30 year mortgage loan. The moral of the story – it’s always a crap shoot. You will never hit it just perfect and hindsight is always 20/20 and then it’s too late. Buy now while the gettin’ is good!
Trading Up: Didn’t think you could afford that bigger home? Now you can! You can get alot more home for the money in this market. A home buyer’s market could also be called a trading up market. Even if your current home sells for less than what you bought it for (which is the case for MANY home owners all around the Twin Cities), typically, this will be a smaller amount and can be offset by greater savings in the new home purchase.
Here’s how: Say your home cost $200,000 and sells for 10% less at $180,000 or $20,000 loss as a seller. This same 10% price drop on the normally $300,000 home you want to purchase equates to a list price of $270,000 for a $30,000 savings as a buyer.
There is ALOT of inventory – around 9-10 months worth of inventory. This is good because you could have your pick of the litter but bad because there are almost TOO many choices. Make sure you take a little time to research an area or 2 or even 3 that you want to live in – this will save you alot of time when you get ready to see houses live. For your sanity and to be realistic, I’d say keep your “serious considerations” pile to no more than 3-4 homes at any given time.
Bottom line – get pre approved and start looking. Jump off that fence and take charge. Real Estate is still one of the most financially sound decisions you can make! I don’t know about you but my Real Estate is worth alot more than my 401k right now!
Give me a call – I’d be happy to help!
Jen McKinnon
Realtor/Investor
MN Real Estate Team
612.384.1073
jen[at]mnrealestateteam[dot]com
