Experts are predicting that these prices and rates are the lowest
it’s going to get and that both will soon be picking up. “Several
housing experts are predicting that this year will be the last chance
for bargain hunters to cash in on the best deals of the weak housing
market.” More details:
Many of the bank-owned
properties currently coming out of the foreclosure pipeline are being
snapped up by investors who are fixing them up and renting them out —
often to those who were displaced by the foreclosure of their own home.
That has helped to lift prices on foreclosed properties, according to
Alex Villacorte, the director of analytics for Clear Capital, which
specializes in housing market valuations.
"That could have a significant impact on the market overall in terms of providing a rising floor to home values," he said.
In
some markets hit hard by foreclosures, the turnaround in prices is
already underway. Phoenix recorded an 8.4% jump in home prices during
the three months ended April 30, compared with the three months ended
January 31, according to Clear Capital.
"It's crazy,"
said Tanya Marchiol, founder of Team Investments, a Phoenix real estate
investing firm. "Stuff I was selling six months ago for $60,000 to
$80,000 is now $90,000 to $110,000."
Miami saw a 4.6% increase quarter-over-quarter through April, and Tampa, Fla., was up 4.4%, according to Clear Capital.
Goodbye 3.8% mortgage. In addition to home prices, mortgages could also move higher.
Mortgage
rates have been at or near historic lows for much of the past six
months. The average interest rate for a 30-year, fixed-rate mortgage has
not topped 4.5% since July 2011 and this week, it hit 3.84%, a new low.
But
rates aren't expected to remain at these record-low levels much longer.
As the economy continues to recover, rates will move higher, said Doug
Lebda, CEO of LendingTree, the online lending site. Although, he said,
they will "stay very reasonable."
The Mortgage Bankers Association is forecasting that the 30-year fixed will hit 4.5% by the end of the year.
Greater demand for loans will help fuel the increase, according to Lebda.
Even
though mortgage rates have been cheap, borrowing for home purchases has
been sluggish. The Mortgage Bankers Association estimates that
homebuyers will take out mortgage loans totaling about $415 billion this
year, an increase of less than 3% compared with 2011. Next year,
however, it forecasts that amount will almost double to $706 billion.
What
does this mean for you? It means if you are considering buying a
property for you, your family, or as an investment or an upgrade, the
market is offering you an opportunity for a fraction of the historic
cost! This is an opportunity you don’t want to miss. Even if you hadn’t
been considering purchasing a property or wanted to buy 5 years down the
road, taking advantage of the market now may make the best sense for your situation.
If you’d like to find out more and see if buying (or selling) a property makes sense for you, please give us a call or e-mail! We’re happy to help you make the right choice!
You can read the original article from CNN Money here.
