A buyer’s market puts you in the driver’s seat
In the boom years of real estate, home sellers held a winning hand over buyers. They could dictate prices and terms to multiple bidders who were lining up at their doors. Today, that’s not the case, and buyers are the ones holding all the aces: it’s a buyer’s market!
First, what is a buyer’s market? Quite simply, it’s when the advantage is with the buyer. A buyer’s market is one where prices are competitive, choices are abundant and lots of bargains and incentives are to be had.
Consider the following advantages for home shoppers today:
Prices have leveled off. In some areas of the country, prices have even declined. Regions that were burning hot in the past have begun to cool and level off, giving the buyer a unique opportunity to find affordable housing that may have been out of reach before. Sellers in this environment — by necessity — are much more prepared to negotiate. While there are no guarantees you’ll get everything you want — bargains are all about give and take — you can be assured that your needs will be heard.
Houses are staying on the market longer, meaning more choices for you. Previously, home shoppers had to make an offer immediately if they wanted to get their top choice. Today, there are a wide variety of homes for sale, with a better chance of getting the home that fits your needs, without the super-stiff competition from lots of other buyers as was seen in years past.
Mortgage rates are historically low. Interest rates are still affordable, remaining near 6.5 percent. Looking back, 1984 saw fixed rate mortgage interests as high as 14.75 percent. Even just six years ago, interest rates ranged from 8 to 8.5 percent. A half-percent rate difference on a $200,000 mortgage, from 6.5 percent to 7 percent, translates into an increase in monthly mortgage payments of $66.00. Over a 30-year mortgage, that’s an extra $23,926! When rates are this attractive, it just doesn’t make sense to try and time the market.
Many builders are offering incentives. Discounted financing packages, and value-added incentives are some of the incentives builders are offering, allowing families to get in on the host of benefits that homeownership offers.
Home equity, the value of a home minus any mortgage debt, accounts for more than half of the total net wealth of the typical family, making homeownership the primary source of a household’s net worth.
This makes owning a home the fundamental first step toward accumulating personal wealth. And don’t forget the incredible tax benefits as well!
Homeownership is always attractive. Besides being a stepping stone to a future of financial security, homeownership provides a sense of community and personal satisfaction and inspires civic responsibility. Homeowners are more likely to vote and get involved in local issues. Studies show they are also more content with their lives, owing to the spillover benefits from an increased social circle, a stronger sense of belonging and increased activity in community groups.
Homeownership is the cornerstone of the American way of life and the fulfillment of the American Dream. A buyer’s market allows that dream to be possible for you as well.
For more information about the homeownership or the buyer’s market, contact the Spokane Home Builders Association at www.shba.com or visit www.nahb.org/forconsumers. To sign up for NAHB’s free consumer e-newsletter, visit www.nahb.org/housekeys.
Fall Festival of Homes
If you are interested in viewing available homes during this “Buyer’s Market,” plan to attend the Fall Festival of Homes. The event features 39 new homes in neighborhoods throughout the greater Spokane area. The event is free to the public and homes are open for touring today and next weekend (Oct. 27-29) from 10 a.m.-5 p.m. A listing of builders and maps to the homes is available at www.spokanefestivalofhomes.com.
If you would prefer to pick-up a copy of the event program produced by The Spokesman-Review, please call the SHBA office at (509) 532-4990. Our thanks to Tomlinson Black, Direct Buy and Golf Savings Bank, proud sponsors of the 2006 SHBA Fall Festival of Homes.