Window of Opportunity: Capture the Savings Today!
By: David Brenton
Unfortunately, the media has painted a negative picture of the current real estate market. Yes, we are dealing with many challenges: foreclosures, job losses, appraisals, housing values, but as Zig Ziglar says “garbage in, garbage out”. To change your thoughts, you have to change what goes into your mind and focus on the positive.
There are many positives in our housing market. With interest rates nearing historic lows, credit readily available and the cap on property taxes, the factors are perfectly aligned for excellent values and incredible opportunities in our housing market.
It is important to note that real estate is like the weather; it is local. It does not matter what housing trends are occurring in California or Florida, it matters what is happening right here, in your neighborhood. And right now, in Central Indiana, it is a great time to buy a home!
Hoosiers should be pleased to know that homes are more affordable today than in recent years. The incredibly low interest rates and the cap on property taxes can contribute to a substantial savings in your monthly payment. As the property tax cap is adjusted to the 1% level in 2010, the savings in owning a home will continue to increase.
As you can see from the comparison between purchasing the same property in 2005 versus now in 2009, the savings in monthly payments are significant. All examples were calculated using FHA financing with a 30 year fixed interest rate. FHA mortgages are available for purchases up to $275,000 with a minimum of 3.5% down payment. Currently, FHA mortgages are available with interest rates around 5%, some even lower.
While buyers may be waiting for the market to “bottom out” so they can achieve the best buy, it is best to seize the moment and make the most of this incredible window of opportunity. The mistake many buyers make is in trying to time the market. Unfortunately buyers wait in anticipation of lower prices or better interest rates and in effect miss the best opportunity. It is nearly impossible to know the true bottom of the market until it is already on the upswing, and by that time, the best opportunities are no longer available.
Now is the time to take advantage of this incredible opportunity.