When is the "right time" to buy a house?
Well, if you are waiting for a big neon sign to turn on and read “BUY NOW” forget it, it’s not going to happen. Market timing is a talent you have to be able to pick up on quickly. By knowing the tricks of the trade, you can improve your likelihood of a remarkable purchase. I will, however let you in on a little secret, now is a great time to buy a house because interest rates are so low. You won’t always have me around to tell you “yay or nay” so here are some easy tricks to help you pick the perfect time to buy.
One of the most important things to remember is that the media isn’t always right. Fear is one of the main reasons people who want to buy don’t, even in a good quality housing market. If you see what you want, go for it!
When you consider buying a home look for these signals that the time is right:
Sufficient supply begins to diminish. This doesn’t necessarily mean the inexpensive homes are being bought. Majority of the time this means that the houses with the best predicted re-sale value are jumping off the shelves.
DOM lessens. Days on market is the phase when a Realtor places a home in the MLS (multiple listing service) for advertising to other brokers, until the home is purchased. When DOM (Days on market) are short, that’s an indicator of a seller’s market coming soon. A seller's market has more shoppers than merchandise, so cost goes up and choice goes down.
Mortgage applications amplify. Interest rates in recent times have plummet, meaning that people are refinancing at a higher rate. This indicates homes are about to disappear from the market, so less supply means a stricter price.
Incentives vanish. Prices are a direct result of demand. To be a focus for buyers, sellers decrease their prices and offer more reason for you to buy, incentives. If the market is doing good, prices aren’t going to go drop but incentives will.
In Real Estate, if one thing is altered something else is directly influenced by the changes. Pay close attention for the signals so you can get on your way to owning that dream home!