I’ve had a few people ask me this question lately. Whether it’s the election or simply the end of the year, knowing whether to buy now or wait until next year is a common and valid question for many homebuyers throughout Northern Virginia and the Washington DC area.
This answer, or the most common answer, is it depends on why you are buying. If you need to move, either a for job relocation or family status, the decision of whether or not to buy may not be up to you. If you need to sell or need to buy at this time, then it’s the right time. But if you are on the fence about buying and you can wait a little bit, other factors can come into play.
It’s important to have anywhere from 4% to up to 20% to place as down payment on the home, if you’re buying with a home loan. Anywhere from 10% to 20% will usually get you a conventional loan and the rates are still extremely low, somewhere below 4% based on your credit history and score. If you’re looking for an FHA loan, you can go as low as 3.5% for a down payment and many programs may even be able to build that into the cost of the home itself, lowering your down payment even further.
But if the down payment is not an issue, you might also consider the current interest rates and terms. Right now, the end of the year, interest rates are low and there are fewer homebuyers on the market, which means you might get better service from lenders, title and escrow parties.
[Related Post :How Much Should We Spend on a Mortgage?]
When it comes to finding the property, this could go two different ways; you will have less competition because there are just not that many buyers on the market but you might also have less options when it comes to the type of house you want. Many homeowners consider selling in the spring and summer, so there are fewer homes on the market. This also means that you will have less competition. There are typically fewer homes for sale this time of year so you can take advantage of being one of a few similar properties for sale, instead of having to compete with dozens (or more) similar homes that go on the market in the spring and summer. There are still buyers out there looking all year round so don’t let the winter months fool you into thinking buyers have disappeared. Buyers who need to purchase homes in the winter are definitely out there and they tend to be more serious buyers, which is good you, the seller!
I am not one of those real estate brokers that tell you to buy now, don’t wait, blah blah blah. It really comes down to your needs, your down payment, and what the market is doing in a particular neighborhood or city in which you’re looking to buy. Waiting until 2017 may or may not be in your best interest. If you’re simply waiting until January or February, there will probably be even fewer homes on the market so now might be better than the first quarter of the next year however, if you’re waiting until spring or summer, you will have more options but prices will also be higher and we don’t know what interest rates will do come the new year.
If you’re looking to know the market value of a particular neighborhood or home give me a call today. We can run some numbers, I can do the research for you and let you know what’s happening in a particular city, town or real estate market.