Home News Now is the time to buy a Houston home, experts say

Now is the time to buy a Houston home, experts say

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of real estate landscape The world is going through turbulent times since the 2020 COVID-19 lockdown. With the world teetering on the brink of uncertainty, sellers suddenly find that open houses have been banned and relocation plans put on hold.

But as the pandemic becomes part of normal life, The real estate market began to soar Just like people dreamed of living in another place while working remotely.

“Two years ago we were waiving testing or cutting testing very short,” Houston said. National Association of Realtors Molly McGinty-Slug Say. “Buyers had to accept that they didn’t like the house very much, but they wanted it very much.”

Rising interest rates and inflation in summer 2022 have completely stalled real estate in some areas, but here in Houston it has slowed to a more manageable rate.

A recent divorce has forced me to buy a new home twice in six months. May experienced a completely different market than December. I had to put up a property that I saw at an open house in May for more than the list price. When I shopped in December, I visited multiple homes that had been on the market for months.

Demand may have fallen, but high interest rates are scaring some buyers as inflation continues to keep prices high. Still, real estate experts say now is the time to buy as the competition will plummet in 2023.

“We’re not just frantically writing offers because it’s a home that meets most of our criteria,” McGinty-Slagle says.

McGinty-Slagle recalls a recent conversation with a homebuyer who decided to return to the home-hunting ring in 2022 after an overwhelming search. Now he is going through a more relaxed process.

“He’s probably paying a little more interest,” says McGinty-Slagle. “But now he can choose a home that he truly loves and doesn’t have to sign a deal with less due diligence.”

According to bank rate, the current average interest rate for a 30-year fixed mortgage on January 20 is 6.46%. This is a drop from previous highs, but a disappointment to those who have seen interest rates at their lowest levels in the past two years.

“I’ve been doing this for nearly 20 years” Mortgage Broker Lenny Morton Say. “I’ve seen the market go up and down. I lived up to the market crash in 2008. The truth is that the 5% rate is really where it should be.”

Morton explains that mortgage rates should normally be as high as 4% to 5% to keep the economy stable. The artificial suppression of the pandemic to boost the economy has resulted in staggeringly low interest rates in 2021 and 2022, but buyers may never see such low rates again. .

“So many people are thinking, ‘I’m going to wait until interest rates double again,'” says Morton. “Well, unless we get into a pandemic again and no one wants it, it probably won’t happen.”

When I bought the house in June, the interest rate was fixed at 4.25%. An initial interest rate of 6.125% was given last month. Sure, I wasn’t forced to make quick decisions like I used to be, but I was worried about making high mortgage payments at that rate. There are options for homebuyers who need to find out but are hesitant because of high interest rates.

Morton suggests the method I have used, the outright interest rate purchase. This is to avoid forcing the seller to significantly reduce the listing price. This affects the value of neighboring homes. Instead, sellers buy out lower interest rates temporarily for homebuyers, helping them save money in the long run.

An interest rate buy-down, like the 2-to-1 buy-down recommended by Morton, means that the seller will pay a large sum to buy the buyer’s lower interest rate for two years.

“Let me give you an example,” says Morton. “Someone had a $700,000 property and the real estate agent wanted to bring it down by $50,000. , if they instead paid an extra $14,000 and kept the selling price, they would have lowered the borrower’s interest rate for two years if they hadn’t lowered it at $700,000.”

Essentially, sellers buy at a 2:1 buy-down rate to buyers. This lowers the buyer’s interest rate to his 3.99% in her first year, 4.99% for him in year 2, and back to the market rate when she bought the home in year 3. Morton said the buyer saved up to $700 a month on her first one-year mortgage payment thanks to her two-for-one buydown.

Interest rates return to their original numbers at the end of two years, at which point buyers tend to refinance. Morton said he will refinance borrowers when interest rates drop, regardless of whether the buyer is using an interest rate buydown. Refinancing means reviewing the buyer’s credit to determine new loan terms, such as lower interest rates and monthly payments.

If you’re still confused, you’re not alone. My loan officer makes personal videos of every step of the loan process and calls or texts me frequently to make sure I understand the documents I receive. A salt-worthy mortgage broker will provide you with documentation explaining the buying process, with a number specific to your home purchase.

“My goal is to make sure that no matter what [homebuyers] Ask me, I can explain it in a way they can understand,” says Morton.

Other tips Morton and McGinty-Slagle shared for homebuyers include:

  • Ask friends and family for realtor recommendations or use Google Business Reviews
  • Interview multiple realtors before choosing one
  • Make a list of the most important things in choosing a home
  • Be aware of additional expenses that may be included with your home purchase, such as a new water heater
  • Older Homes May Have Lower Property Taxes Than Newer Homes

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