Buying or selling a home is a big transaction and can be very stressful. While your decision to put your home on the market or purchase a new one shouldn’t be made in haste, you can’t afford to drag it out either. Since every real estate market is different, it is important to understand when it’s the best time to buy or sell. Here are some helpful tips and insights.
Every Location is Different
Twenty years ago, it was possible to predict the real estate market forecast. This is no longer possible today. Even though the national news channels may be rife with stories about hot real estate deals and falling prices, it doesn’t necessarily mean it’s happening in your area. These days real estate prices can vary from town to town even within the same county. If you want to buy or sell a home, the best way to find out about local information is through a real estate agent such as http://www.WrenRealtyinc.com, who will be informed about the real estate trends and values in your area.
Interest Rates Ebb and Flow
It’s most likely that you’re going to need a mortgage to purchase your next home, and don’t forget that long-term interest rates can fluctuate. Although today’s interest rates are around 3-4 percent, during the 1980s they were above 12 percent. The best time to buy a home is before the interest rates start creeping up again.
Be Financially Ready
So you’ve considered the fluctuating interest rates, now you need to be financially ready. That means knowing how much you can afford to spend, calculating mortgage payments, and if necessary getting pre-approved for a new mortgage. Don’t forget to calculate all the costs associated with buying a new home, including deposit, closing costs and moving expenses.
Seasons Are Changing
It used to be the case that spring was the hottest real estate selling season for two main reasons: firstly because homes can be shown in their best possible light at that time of years and secondly because parents often prefer to purchase a new home in spring or summer so their children can begin a new school in the fall. Although house sales are still strong in spring, today many potential buys are looking at listings on a daily basis, throughout the year. If you’re not in a rush to sell your home, you may want to consider putting it on the market out-of-season, when you’ll have less competition from other sellers.
Selling Your Home Before You Buy a New One
In an ideal world, you’ll sell your house quickly, your offer on the house of your dreams will be immediately accepted and you can move in next week. In reality, this scenario rarely ever happens. There are a number of benefits to selling your home before you purchase another. If you already know your house has sold for $220,000 it makes is easier for you to choose your next one because you know how much down payment you can afford. You’ll also be able to pre-qualify for a mortgage on your new home. This will reduce the time it takes you to get a mortgage once you’ve found your dream home. It also shows the seller that you are a serious buyer. There are however, some drawbacks to selling your home before you have another one. If your buyers wish to move in straight away, you may be left without a place to live for a while. But if you have the chance to make a good sale, it might be worth renting a property until you find the right place for you and your family.
Buying a New Home Before You Sell Your Current One
In many cases homeowners will want to purchase a new home before they have a buyer for their current home. But how can you possibly afford to pay two mortgages at the same time, ever just for a short while? You don’t have to, thanks to bridge loans. A bridge loan allows you to use your first home as collateral for the second one. You will still have to sign a mortgage note but you will not pay interest until you’ve sold your first property, by which time you can repay the loan.
Use these tips to get a feel for the market, but remember, no one can really predict when the right homes or buyers will come along. The best thing you can do is arm yourself with as much information about the local real estate market and the area you wish to move to.
Georgina Ellis gives her advice on real estate matters whether you’re a first-time buyer or a seller who needs to downsize. Her articles appear on a range of personal finance and property blogs.