Recently Real Estate Ink, posted information about the inflation and rental growth predicted for next year. As we mentioned, it is not great news for renters. Below we’ve listed some further reasons why it may be the right time for you to take the leap in 2016 and buy your dream home in Brevard County.
Even though mortgage rates, which have been low recently, are likely to start increasing, next year will be a good time to buy a house thanks to several reasons:
Disappearing Cheap Mortgages
The current record-low mortgage rates will eventually vanish if the Federal Reserve does what it’s expected to in 2016: increase interest rates, for the first time in 9 years. The rates are predicted to rise gradually, but remember that higher rates increase borrowing costs as well as those mortgage payments you have to make each month. So, the earlier you buy next year, the better.
Slowing Home Prices
Economists say that real estate prices are projected to rise about 3.5% next year, meaning that the rising values we’ve seen lately will start to slow. This is good news for potential buyers who were blocked by the increasing prices, and it may lead many of them to finally take the plunge.
However, popular U.S. cities with top real estate markets like Boston, New York City, and San Francisco will likely not see their home prices decreasing as much in 2016. Unfortunately, experts also note that home values will likely outpace wage growth. This makes home affordability challenging, particularly for lower-income buyers.
Thanks to the slowdown in home prices, more owners will list their homes. Owners will be happy with the price appreciation they’ve experienced, experts say. And an increase of homes on the market means more choice for buyers. It also means that bidding wars will decrease, further easing prices.
Another growing market in 2016 will likely be the new home market. Builders are expected to focus more on both starter homes and middle-range homes, further increasing the variety and helping buyers.
Because rent prices will keep mounting, it will be cheaper to buy than rent in most cities around the U.S. next year. Mortgages could get more expensive, experts say, but buying might still be the better option. According to housing economists, it would take a rise of interest rates to 6.5% just for the cost of buying a home to equal that of renting.
Contact your Melbourne, Florida real estate broker to learn more about how we can best help you with your real estate needs. We offer full service property solutions in Melbourne, Melbourne Beach, Palm Bay, and other locations throughout Brevard County, including sales and leasing representation, property management, and project development. Our professional, courteous realtors want to help you find your dream house!