The reward for folks in the current home buying market is having flexibility and options. They’ll get to know a market with super, super low interest rates. How low? You may need to ask your parents to tell you about a time when rates were double digits. Things from the 80s are making a comeback these days, but the high interest rates from those times are not welcome back. As of this writing, rates are all below 4% and are expected to stay low. The interest rate has everything to do with your buying power. See the comparisons below. A newspaper headline can mislead you, but these numbers are pretty clear:
Townhome Purchase March 2019 (4.5% interest, 30-year loan) - $269900 = $1367 monthly payment *March 2020 (3.1% interest, 30-year loan) - $318,900 = $1367 monthly payment That's $49K more in buying power from last year.
Single-Family Home Purchase March 2019 (4.5% interest, 30-year loan) - $431000 = $2187 monthly payment *March 2020 (3.1% interest, 30-year loan) - $510,000 = $2187 monthly payment That's $79K more in buying power from last year.
*Default figures are hypothetical and may not apply to all situations. Consult a financial professional regarding your situation prior to relying on these results.
What is probably the most curious thing about this current housing market is that the availability, the options and the pricing that exist today will not be the same later in the year. Supply chains are currently being interrupted by COVID-19 and the hiccup is likely to trickle down to hit builders right about the time more buyers are wanting to enter the market. The existing demand in the housing market will simply intensify. First it was toilet paper and now this. Argh.
Wherever you’re at in your home search, we’re here to help. Let us show you what options we have across townhome and single-family home products from Davis County to South Jordan. Our agents are ready to present you options virtually allowing all of us to do our part to social distance at this time. If your current situation allows you to move forward, let us show you the way. The effects of COVID-19 may have disrupted the events you can attend and the social gathering you prefer, but it has also uncovered unique opportunity for purchasing a home. A home that will be around to enjoy after we wave goodbye to a pandemic.