While low interest rates seem like a one hundred percent assurance to pull the trigger on a big purchase, there are plenty of factors to consider before you take one of the biggest steps we all do in our life. After all, we’re rigth around the corner of a recession of a global biological catastrophe, and who knows what kind of social, political, and economic fallout is waiting in to happen.
Is now really the best time to buy a house?
This is a question you can answer in any time with crisis or not, if you can afford paying rent, then definitely you can pay a mortgage, and remember even with a crisis like the one we're living in the whole World, the rent will not decrease, at least not that much to be a factor of decision between paying a mortgage oe renting. Also remember most of the investors look this time to take the opportunity because they know the most of the public is going to contract, so if you think your industry won't be impacted by what is going on then, you should proceed with caution.
So, yes there is a good reason to use caution, to begin with, low interest rates have little to do with all associated initial costs of purchasing a home, including property taxes, homeowner's insurance, and of course closing cost that can be approximately be anything between 3% to 5% depending on the program you are using to purchase the home.
You will aslo need to take another point in cosideration: Morgage Rates, yes as of rigth now in April 2020 rates are at historic lows, but they are not zero percent, you have seen in the news the Federal Governmet reduced the Interest rate to almost zero percent, but that is for a wholesale market with short term loans, so you can be sure you're not getting that on you home loan, but yes there is lowere interests right now and this translates into more affordable monthly payments on you home loan.
There is another factors, during the time the COVID-19 Pandemic in many cities you are not allowed to go inside a home, not only the homes that are vacant, so be prepared to ask for a lot of pictures when buying your home. Stanley Estrada Realtor® Licensed with Keller Williams Realty Antelope Valley is adding some 3D Virtual toors to all of his listings, so you can see the home and browse it like if you are there.
Home Inspections And Appraisals:
You may have no access to the home so it the home inspection will be very limited, until today 04/14/2020 appraisals are still being done, but remember this situation changes everyday, depending on what amount of time is needed to contain the virus those will be very difficult things to do as usual right now.
Title Officers, Escrow Officers & Notaries continue to work so that will not be an issue to close the transaction on your home purchase.
The pros of buying a home now
Remember once man's crisis is another opportunity. For those who are eager enough—and willing to flout traditional customs in favor of a virtual approach—there are deals to be had. Rigth now are there less buyers on the market, while rigth before this crisis, there was multiple offers for the same home, right now you may have more chances to get the seller to help you with some or full part of the buyer's closing costs. because the inestability of the market will cause most of the seller's to be willing to help you rigth now. But even with this going on sellers will be still selling for a higher price of what they bought before, so at the end this is a win-win situation.
While in other areas in California many sellers are removing their homes from the market, in Los Angeles County and more specifically in the Antelope Valley area there are few homes being listed but also the sellers that are ready to sell are selling their properties, just in the first days of April 2020 there is an average of 18 homes going pending everyday while the same amount of homes are coming to the market.
So now it is a good time to buy a home if you're employed by an industry that is not being devastated by the coronavirus, and have the necessary resources for your downpayment and closing costs, you can take advantage of the low interest rates that minimizes the risk, and start browsing online, so you get familiar with what the market has to offer, and if you have now decided you found the new place to call home, then contact me and I will be there to offer you the best of the digital world.