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Lot Size
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Home Size2,336 sqft
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Beds5 Beds
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Baths3 Baths
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Year Built1987
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Days on Market11
2016: A Great Year to Purchase a Home
- Real Estate Tips
- Coldwell banker Encinitas, encinitas real estate, encinitas realtor, home buying advice, home buying tips, homes for sale in encinitas, Linda Moore, San Diego real estate
- January 11, 2016
There’s more to choose from
Home prices are expected to rise only 3.5 percent by the end of 2016, which is at a slower rate of increase compared to what the U.S. economy has seen in previous years. Because sellers have experienced price appreciation, they may be more likely to put their homes on the market sooner in order to reap the benefits of the previous rate increases. As a result, there is expected to be a flood of new homes on the market—which is great for buyers.
Mortgage rates are expected to increase
In a previous blog post, we discussed the recent news that the Federal Reserve had increased interest rates by a quarter of a percentage, the very first increase since 2006. Market analysts have predicted a slow but steady increase in this rate, perhaps 1.5 percent per year. That means by the end of 2017, the interest rate will be sitting at about 3.25 percent—still under historic norms. Keep in mind that the rate increases that are being discussed are the Federal Funds Rate, not mortgage rates directly. The Federal Reserve does not directly control mortgage rates; they are decided by the price of mortgage-backed securities sold on Wall Street.
However, the idea is that the Federal Funds rate influences mortgage rates. Although the increase is projected to be small, it will most likely have some effect on the amount of money you will be paying on a mortgage in the long term.
Because of this information, you can reasonably conclude that now is the best possible time to get a favorable rate on a mortgage. 30-year rates are currently around 4 percent, adjustable-rate mortgages are around 2 percent, and fixed-home mortgages are even lower.
Rent has already increased rapidly
In the past year alone, 88 percent of property managers have increased rent—and another 8 percent increase is expected to follow. In many U.S. cities, monthly mortgage payments are actually cheaper than rent. Paying an ever-growing amount in rent at the end of every month will certainly not lend you any benefits in the long term; that’s money you can’t get back. Mortgage payments are not only lower than ever, it’s an investment in a huge asset—your home.