Daffodils and baby bunnies aren’t the only sings of new life this spring. Nationally, real estate too is starting—tentatively-- to bloom.
Consumer Confidence Blossoming
For people to buy homes, they need to feel assured that a) they can pay for them and b) the homes won’t depreciate the moment they’re purchased. People also want to believe “now is a good time to buy,” in terms of home prices, rent prices, and interest rates.
Interest rates, as we all know, have stayed at a historic low, while rent, nationally, has reached a historic high. Meanwhile, thanks to progress in both job security and property values, the national attitude seems to be moving toward optimism. For instance:
Interest rates remain very inviting. The average rate on a 30-year fixed-rate mortgage is 3.86 percent, according to Bankrate.com. Many Americans haven’t seen interest rates this low in their lifetimes.
Homes are more affordable; but at the same time, their prices aren’t in free fall anymore. Yes, prices are down in many parts of the country below 2006 levels; yet price declines (as tracked by the Case-Shiller index) slowed at the close of 2011. Many parts of the country, such as Miami, Phoenix, and Washington, D.C, are posting price increases.
A Good Kind of Climate Change
Though we might have reasons to worry about uncommonly warm weather all over the planet, we can’t deny that sunny days help homes get built and sold. Open houses enjoy much more traffic when the weather is inviting, and homes themselves show better bathed in sunshine. Consumer confidence and good weather are spurring an uptick in real estate transactions this year, as confirmed by the AP report that “The spring buying season got an early lift-off from an uncommonly warm January and February — a winter that was the best for sales of previously occupied homes in five years.”
Meanwhile, dry skies make new construction easier. “Permits to build houses and apartments rose in February to their highest level since 2008.”
Rent Vs. Buy Calculations May Favor Buying
As rents increase, more first-time buyers are inspired to do just that: buy for the first time. If you’re comparing renting to buying yourself, check out ZipRealty’s Rent vs. Buy Calculator. We have a number of other resources in our Learning Center as well, everything from financing calculators to tips for repairing your credit.
As always though, home ownership is more than just a monetary decision, and even the money part isn’t as simple as a monthly payment. If you’re thinking now might be a good time to buy but aren’t sure, take some time studying resources that help you decide. And remember: national trends don’t necessarily speak to local ones, so talk to a local real estate agent in the area you hope to buy to get the most relevant 4-1-1.
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