Pros and Cons of Buying a Home in the Current Market

Buying a home today might seem like an entirely different ballgame than it was just 6 or 9 months ago. With rising interest rates, and headlines that tell us the Federal Funds Rate is likely to continue going up, some home-buying hopefuls are wondering if they will have to wait a while to buy or lower their budget significantly.

Does that sound like you? If you are concerned about whether now is still a good time to buy a home, check out these pros and cons to help you make a decision.

Pros of Buying a Home in Today's Market

There are some benefits of buying a home that are true no matter what the market looks like, which is why so many financial experts agree that buying a home is one of the key factors to building wealth.

Lock in the Cost of Housing

Locking in your housing cost is a major perk of buying a home, as opposed to rent prices that are subject to change at every lease renewal. With a rising market, you can almost guarantee that your rent is going to go up in the next year or two.

Buying a house means locking in today's housing prices, and you may even be able to lower that price over time through refinancing in the future.

Even land can be a great option right now for building later! We know several folks that bought land and are sitting on until the market shifts in order to build. A land loan may be a great option for the time being.

Begin Building Equity

Buying a home, whether it is your first or your fifth, puts you in a position to begin building equity. Experts predict that homes will continue to appreciate in the coming years, even if they do appreciate at a slower rate than we have seen in the past two years.

This means your net worth with naturally grow simply as a result of buying a home, without any additional investment from you over time.

Enjoy the Non-Financial Benefits of Homeownership

There are also plenty of pros of owning a home that are not exactly financial but priceless. These include having control over if and when you move, being able to renovate and decorate however you want, and establishing a tight-knit community with neighbors.

Benefits Unique to this Market

Today's market also provides some unique benefits as it shifts from an entirely seller's market to something more balanced, working in your favor as the buyer. These pros include:

Sellers are motivated, often willing to help pay closing costs, cover discount points to buy down your rate, or finance repairs and improvements before closing
You as the buyer have more negotiating power today than you would have this time last year, meaning you may be able to offer a lower price without getting outbid by competition
You won't need to waive inspections, as some desperate buyers were a year ago
A slower paced market gives you more time to consider your purchase
The results of the home inspection can give you a chance to negotiate, which we weren't seeing much of in the recent past
Contingency contracts are back on the table, after being nearly impossible to offer in the past couple of years
If you need a longer contract to close, now is the time to ask for it

Cons of Buying a Home in Today's Market

You are probably hearing lots of doom and gloom reports about how bad today's market is for buyers. The way we see it, there is really only one drawback presented by today's market: higher interest rates.

A higher rate will likely affect your budget and require you to get creative, but it doesn't mean you cannot buy right now. Negotiating with sellers and asking them to cover some of the initial costs, or discount points to secure a lower rate, may make buying now more doable than you think.

And the great thing about interest rates? They change. The past few months may not have changed in your favor, but when the market shifts in the other direction you can always refinance to take advantage of the favorable change.

Want to learn more about buying a home? We would love to help. Contact us any time to find out what you might be approved to borrow or to ask other questions.

Let's chat about how we can price your home and prepare for a successful home sale. To learn more about selling your home this fall, contact us any time! For more information about preparing your home for sale, contact us any time! Contact our office for information on Carson City home styles or Dayton NV real estate.