The year 2020 has proven to be an economic rollercoaster. This chaotic and uncertain time has left us hesitant to make big financial decisions, especially when it comes to home buying. Many of us are waiting to invest in a home until 2021 or later — but what if the time to buy is now?
A decline in interest rates has appealed to potential home buyers in the later half of 2020. But is it enough to sway your purchasing decisions? In this article, we’ll discuss what factors you should consider before purchasing a home in 2020, and what might be in store for the year to come.
Consider Your finances.
It goes without saying that financial stability should be your first priority when considering a home purchase. Has your income been steady throughout 2020? Have you been able to pay your bills on time and put some money into savings? If you feel your income is stable enough to purchase a home in 2021, then go for it. However, keep in mind that unemployment rates are high, and to avoid any big moves if you think your employment status might change in the near future.
Evaluate the housing market.
The housing market has proved to be complicated in 2020. Prices have remained high since June, leaving many unwilling to jump the gun until next year. Prices are currently high because there’s an overwhelming demand in the market. Seems strange right? Turns out, this high demand is because of a steep drop in mortgage rates. This has persuaded home buyers to take advantage of low rates while they last and invest while they can.
Although these decreased interest rates are tempting, supply for homes is still low. Many are afraid to put their home on the market until the pandemic ceases. Unless you find exactly what we want, we recommend waiting until 2021 to find your dream home.
Focus on geographics.
Pricing of homes will always vary by location. Some areas have been hit harder than others because of the pandemic, and certain cities might see low housing prices because people from out of state are unwilling to move there right now. If prices are high in the location you’re pursuing, you might want to hold off until 2021.
Above all, the most important thing you can do in making a home purchasing decision in 2020 is staying informed. Staying in touch with a trusted source in real estate can help guide you in the right direction. If you don’t feel ready to purchase a home just yet, take this time to prepare. Hold on to your money, and look to cut down on certain expenses until you’re ready to purchase. However if your financial condition is stable, you can afford a mortgage loan, and your dream house is right in front of you, take advantage of low interest rates and invest now!
Need some assistance in your home buying decision? Ken Venick can help! Ken has over 30 years of experience in the mortgage loan business and can put you in the right mortgage loan product for your unique needs. Visit our FAQ page to learn more and contact us today!