(FinancialHealth)- No sooner than a real estate agent sits a For Sale sign in a yard, they’re picking it right back up again–at least, that’s how it feels. Houses are selling fast–leaving consumers wondering how long this can continue. Realtor.com has reported a 17.2% increase in prices of homes with the average home costing $375,000. Let’s break that down:
The Average Monthly Payment
- $375,000 mortgage for 30 years
- An interest rate of 3.5%
- With a 20% down payment ($75,000)
The monthly mortgage payment would be about $1,347/month. While home prices have reached record highs, most families haven’t experienced an increase in income. This could leave home buyers wondering if the housing market will continue to go strong or if it will head for another crash.
Will The Market Crash Again?
Experts think it’s unlikely that a crash is in the future. Right now, demand for homes is simply exceeding the supply, driving up the prices. While the pandemic may be contributing to the spike in prices, it’s possible the market will level out as life normalizes but will be unlikely to crash–which could be disappointing for home buyers looking for a steal.
However, this is good news for homeowners and those looking to sell their homes. It’s possible that the demand for homes could continue for another 5-10 years until the housing market can produce enough homes
Tips for Homebuyers
For those looking to buy a home, waiting until the market levels out may not be an option. Instead, homebuyers may be faced with a competitive market that could keep prices (and mortgage rates) high. Here are a few tips for those looking to buy a home right now:
- Consider low-income housing options
- Look into Emergency Housing Assistance programs
- Consider foreclosures
- Repair your credit
- Decide how much home you can afford
- Save for a downpayment
- Watch local real estate listings
- Get pre-approved for a home loan
Buying a home is an important decision. You’ll want to make sure it fits your budget and suits your needs. While buying a home can be a frustrating process, taking those steps to be prepared could help. Since experts don’t believe the market is headed for a crash, it will be important for homebuyers to watch the market and be ready to make an offer before it’s going, going, GONE!
~Here’s to your Financial Health!
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