With home prices rising for the third straight quarter, most would agree that the housing market recovery has picked up steam. In fact, according to S&P Case-Shiller, home values increased 7.3% in the last quarter of 2012 alone.
This
means that we are seeing the bounce from the home value bottom. Combined
with mortgage rates with an average in the 3% range, and you have the perfectstorm for the best time to buy a home.
The
only downside to this is that as the recovery continues, affordability will
fall. Home values will continue to stabilize and improve, and mortgage
rates are going to rise. Contrary to what many people now think, the
government doesn't control mortgage interest rates. While the Fed has
been able to manipulate and affect mortgage rates with things like quantitative
easing, it is not the same as control.
The
housing market is recovering as part of the US economy as a whole, and with that
recovery is a natural increase in mortgage rates. That means that even as
house prices rise, so will mortgage interest rates, providing a double whammy
to buying power. Be sure to discuss with a professional how this changing
market will affect you or you may call me anytime at (805)710-2415. I
always enjoy hearing from you!
Nancy Puder is the broker and owner of Signature Properties, a real estate sales and management firm in Arroyo Grande, CA. You may contact her at Nancy@NancyPuder.com or (805)710-2415.
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