The dilemma of buying a home or waiting has become a pressing question for many prospective homeowners in today’s volatile housing market. Moreover, home prices have surged recently, and the Federal Reserve’s efforts to curb inflation have led to soaring mortgage rates.
Current Market Trends
Home prices have reached unprecedented levels, with the median sale price of an existing home hitting an all-time high in May 2024 at $419,300, according to the National Association of Realtors (NAR). Additionally, the Fannie Mae Home Purchase Sentiment Index from June 2024 revealed that 86 percent of consumers believe it’s a bad time to buy a house. Furthermore, this combination of high prices and interest rates has made many potential buyers reconsider their decision.
However, some aspects of the market are becoming more favorable for buyers. For instance, the days-on-market figures have increased, providing buyers with more time to make informed decisions. NAR data shows that homes typically spent 24 days on the market before selling in May, up from 18 days a year ago. Likewise, available housing inventory is rising, showing an 18.5 percent year-over-year increase, according to NAR.
Increased Listings and Potential Price Adjustments
According to RE/MAX’s May National Housing Report, new listings have sharply increased by nearly 40 percent from May 2023. Therefore, this growing inventory offers more options for homebuyers. Additionally, if inventory continues to grow and mortgage rates remain stable, prices may eventually begin to soften.
Buying a Home Now
Mortgage rates have decreased slightly from the 8 percent highs of October 2023 but are still around 7 percent. So, with home prices remaining high, you might be hesitant to buy now. However, buying a home now means you can start building equity immediately. Furthermore, buying a home in Myrtle Beach now avoids the risk of potential future mortgage rate increases, which can significantly impact your monthly budget and overall interest payments.
If you can answer yes to these questions, it might be a good time to buy:
Do you have excellent credit? Anytime you’re borrowing money, lenders offer the best mortgage rates to those with high credit scores. Additionally, the median credit score for mortgage borrowers in the first quarter of 2024 was 770, according to the Federal Reserve Bank of New York.
Have you saved enough for a down payment? In addition to paying your bills on time, a substantial down payment reduces the amount you need to borrow and the interest you’ll pay. Besides, having additional cash reserves is crucial for financial stability.
Are you planning to stay in the home for a while? Beyond the purchase price, purchasing a home in Myrtle Beach comes with closing costs and potential tax implications. So, it’s wise to stay in the home long enough to justify these expenses.
Reasons to Wait
While buying now has its advantages, waiting might be beneficial in certain situations:
If home values in your area are dropping: Some areas have seen price declines. For example, Austin, Texas, experienced a drop in median home prices from $667,000 in May 2022 to $587,250 in May 2024. Therefore, if prices continue to fall, waiting could save you money.
If inventory in your area is increasing: When there are more properties on the market to choose from, buyers enjoy more bargaining power. Additionally, according to NAR, while the overall housing supply is still low, specific areas have seen a jump in inventory.
If your personal finances need improvement: Waiting can be wise if you expect a financial windfall or need time to improve your credit score. So, better financial health can lead to better loan terms.
Analyze Your Local Market
Deciding whether to buy now or wait largely depends on the local market conditions. Furthermore, real estate markets can vary significantly, even within the same state. So, it’s crucial to work with a real estate agent who knows your local area well.
Considering a Recession
The possibility of a recession adds another layer of complexity to your decision. Therefore, recessions can affect job stability and the real estate market. Nevertheless, fewer buyers during a recession can also mean less competition and potentially better deals.
Next Steps
Buying a home now may seem overwhelming, but you’ll also face some risks if you wait too long. So, thoroughly check your finances thoroughly, consider how much you can pay upfront, and assess the local market conditions. Then, consult with an experienced local real estate agent like Full Potential Real Estate, LLC to determine the best course of action for your situation.
Take the next step toward buying a home by talking to a real estate professional today! Call Full Potential Real Estate, LLC now.
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Full Potential Real Estate, LLC
PO Box 571
Conway, SC 29526
(843) 251-3794
http://fullpotentialrealestate.com/
We Serve – Carolina Forest SC, Surfside Beach SC, Conway SC, Myrtle Beach SC, North Myrtle Beach, Socastee, Little River, Murrells Inlet, Longs/Loris, Forestbrook
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