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Is It a Good Time To Buy a House in Oceanside, CA

Aug 27

Are You Ready For Home Buying? Things To Think About Before Making Your Move

When buying a home, you want to consider the local housing market and the national housing market. Both of these things can change often, so you’ll want to look at them closely.

Housing Inventory

Timming for purchase of Oceanside housing

First, you'll need to check the housing inventory of your area. Does this projected number of active listings suggest buyers' or sellers' market? The answer may help you decide whether right now is a good time for you to consider becoming a homeowner. In order to proceed, it's best to understand the key characteristics of buyers' or sellers' market and how they apply to you as a prospective house owner.

A sellers’ turning into a buyers’ marketplace is one of the best indicators of an improving economy. When the housing inventory is low, potential buyers can afford to pay more for properties. Buyers who are willing to offer more money for a property may also be able to negotiate better deals on financing and closing costs. In addition, if the current economic climate continues, buyers may be able to get loans with lower interest rates.

One way to tell if there is a seller’sprice is by noticing whether homes are selling faster than normal.

In a seller’s market, buyers have an edge because they can negotiate lower prices. But if you’re looking to sell your house right now, you may not get the best price. You might find yourself competing against multiple offers. That means you could end up selling your house for less money than you hoped. So before you put your house on the market, consider whether the current market conditions favor sellers or buyers.

When there are more sellers than houses available, we call it a “seller’s market.” When there are more houses available than people looking to buy them, we say the housing market is experiencing a “buyer’s market.”

In a buyer’s climate, you see houses being bought faster than normal and often for less than the asking price. When there are more properties listed than the number of people who wish to buy them, it can lead to a bidding frenzy. Buyer’s markets can also cause sellers to lower prices, because they know they won’t get as much competition. If it’ s a buyer’ s environment, there are more sellers than there are homes on sale, so it’ s a great opportunity to find a bargain. Sellers might not be able to get as high a price as they would if there were more homes on the open housing list, but they can still make money off their property.

As long as 2022 is the year you want to start building your own house, be sure to look out for building trend developments for new homes. Because of the shortage of workers and materials, building houses has become more difficult and often more expensive.

Home Prices

With low interest rates and an abundance of properties available, home sales skyrocketed during the coronavirus crisis. However, the pandemic has caused a significant drop in home values across the nation.

By 2022, buyers can expect high real estate market values, low inventories, and a fast turnover rate. The National Association of Realtors (NAR) expects house price increases of 5.7% by 2022.

When thinking about buying a house, you should first take into account whether now is the right time for you. If you're a prospective buyer,  you should think about its potential price growth.

The National Association of Realtors (NAR) recently reported that the median U.S. single family house value rose 12.3 percent during the month of November. This marks the 117th consecutive monthly increase, the longest run of annual gains ever recorded. Purchase prices continue to rise across all regions, although the pace of growth has slowed somewhat. Inventory remains low and buyers should expect to see continued upward pressure and sometimes, houses are sold above list price.

With so much competition out there, the market is full of homes that are underpriced. So, it’s important to get your house on the market as soon as possible. Your goal is to find a property that is priced right and ready to sell. You can do this by getting creative about how you present yourself to potential buyers. For example, you could create a video tour of your home and post it online. You can also put together a brochure that highlights the features of your home and include photos. These marketing tools will help you stand out among the rest of the pack.

First Time Buyers

There are many more interested buyers than available houses and that makes it a hard time to buy a house for first time buyers and help of experienced real estate agent is essential.

The advantage of the historically low mortgage rate environment of the previous year appears to have diminished for first-time homebuyers, and affordability is projected to become an even greater constraint for them in the future.

First-time buyers accounted for 30 percent of sales in June, down from 31 percent last month and 27 percent in May.

Conventional loans typically carry lower interest rates than FHA loans. However, they're usually limited to borrowers who meet certain income requirements

These loans are often used by first-time homeowners who may not qualify for traditional mortgages because of poor credit histories. They also allow borrowers to purchase homes with lower down payments and smaller amounts of equity compared to conventional loans. In addition, they offer flexible repayment options and low interest rates.

Mortgage Rates

You not only need to be ahead of the curve when it comes to today’s housing markets, but you also need to understand if mortgage rates will change or remain relatively unchanged in 2022.

According to CNBC, the Fed expects U.S. GDP to increase by 4 percent in 2022, up from the original estimate of 3.8 percent. However, the Fed has now revised their outlook for U.S. economic growth in 2023 to 2.2 percent, down from 2.5 percent. This means that interest rate hikes could be coming soon.

Higher interest rates might seem scary but they could actually help you buy a home faster since there won't be as many people looking for houses. You'll have an advantage when buying your dream home.

History shows us that the average rate of home loan borrowing costs peaked at 5.25%, and then fell back down to 4.51%. Since then, they've risen again, reaching an average of 4.75%. One factor driving these higher prices is the Fed's decision to start tapering off its purchases of bonds. Another is that the housing market is improving, so lenders are willing to lend money at lower levels.

When there are fewer customers available, the yield on a bond has to go up to attract investors. This also means that interest rate rises. Interest rate rose to 4.17 percent in 2014. In 2015 the rate dropped back to 3.85 percent as the market cooled down.

According to Freddie Mac's latest weekly survey, conventional 30-year mortgage rates fell 0.4 percent last week, which was the eighth largest decline since records began in 1971.

 

Post-Pandemic Effect on Housing Market

With the coronavirus still lingering around us into 2022, it hasn’t let us forget about our homebuying journey. We’re wondering what impact it will have on the lending market. Will stricter loan requirements remain in effect? How will the restrictions placed on mortgages change? What types of loans do we see being impacted by these changes?

First, there are three types (or categories) of mortgages affected by these new rules: FHA loans, VA loans, and conventional loans.

In 2022, the minimum lending criteria will continue to be based on your FICO® Scores (the three main factors used to calculate your overall risk profile). Your FICO® Scores range between 300 and 850. A higher number means you're considered a better borrower. However, if you do not meet the lender's minimum lending criteria, you may qualify for an alternative type of financing such as a home equity line of credit (HELOC) or second mortgage.

Private Mortgage Insurance (PMI)

Private Mortgage Insurance (PMI), sometimes called "Insurance" or "Loan Origination Fee," is a fee charged when you take out a home loan. It protects lenders against loss if you default on your payments. 

The amount of PMI varies depending on how much equity you have in your property. If you don't pay PMI, the lender could lose money on the loan.