Some Highlights:

  • The “Cost of Waiting to Buy” is defined as the additional funds it would take to buy a home if prices and interest rates were to increase over a period of time.
  • Freddie Mac predicts that interest rates will increase to 4.8% by this time next year, while home prices are predicted to appreciate by 4.9% according to CoreLogic.
  • Waiting until next year to buy could cost you thousands of dollars a year for the life of your mortgage!

source: Keith Kreis Real Estate News – Your local Agent

Ask Keith Your local Agent

Costs of Buying a Home – Ask Keith Kreis

What To Consider When Buying A Home – 5 Things You Should Know As A Buyer

If you are a like a majority of the US population, when it comes to buying a home, you are likely going to rely on financing and working with a mortgage lender. Many people tend to feel overwhelmed at the process of choosing a lender, interest rates, and the process of buying a home in general. With the right agent by your side, and with the right information in hand, you shouldn’t be worried about the process. Consider these five factors when purchasing, to ensure you find the lowest rates, and the right lender for your mortgage needs. Costs of Buying a Home

1. How much does it cost? –
Understanding the true cost of home ownership is the initial phase of purchasing a home. Your ownership costs consist of 4 major categories which are: the principal, interest rates, taxes, and insurance. Your mortgage payment is made up of the principal and interest rates; interest will pay borrower fees while the principal amount pays down the overall balance due on the home. Amortization calculators come in handy when calculating ownership costs. Costs of Buying a Home

Property taxes are valued at 1.2% annually,, of the home’s total value. If you have a mortgage, homeowner’s insurance is typically required as well. Prices range from about $700 up to $1200 depending on the home’s value, and level of coverage you choose. For planned unit developments (PUD) or condos, there might be PITI insurance requirements as well. Homeowner association dues cover upkeep and maintenance, and general building or development amenities. Costs range from $100 to $1000 (if you are in a PUD, arrange for your own future maintenance costs).

2. Know your history –
Credit history plays a major role when lenders are determining interest rates. Lenders want individuals who have a strong credit history, pay bills on time, and have a high score; so, do your own research and know your score before applying. If you have a strong credit history this is great; otherwise, consider applying for a few lines of credit. Also note this will drop the score a few points, but after a few months of consistent, on time payments, it will go right back up. By law, you can get a free credit report. Do so, review it, and find ways to increase your score. From there, you can decide when the time is right to apply for a mortgage. Costs of Buying a Home

Readmore: 5 things you should know as a buyer

The ‘REAL’ News about Housing Affordability

Some industry experts are claiming that the housing market may be headed for a slowdown as we proceed through 2017, based on rising home prices and a potential jump in mortgage interest rates. One of the data points they use is the Housing Affordability Index, as reported by the National Association of Realtors (NAR). Costs of Buying a Home

Here is how NAR defines the index:

“The Housing Affordability Index measures whether or not a typical family earns enough income to qualify for a mortgage loan on a typical home at the national level based on the most recent price and income data.” Costs of Buying a Home

Basically, a value of 100 means a family earning the median income earns enough to qualify for a mortgage on a median-priced home, based on the price and mortgage interest rates at the time. Anything above 100 means the family has more than enough to qualify. Costs of Buying a Home

The higher the index, the easier it is to afford a home.

Why the concern? Continue reading…