For quite some time, Netter Real Estate has been telling you that NOW is the time to buy because home prices are reasonable and interest rates are at historic lows. Especially in the last few months, we are finding that many are following this sound advice and making home purchases. However, there are still some potential first-time home buyers that are hesitating to make the decision to buy rather than rent. Netter Real Estate realizes that a home purchase is a decision not to be entered into lightly. When we ask what the greatest reason is holding our potential first-time homebuyers back from making their purchase, many say that they are delaying the decision to buy a home because they are not sure where prices are headed. The fear is that if prices soften after they make their purchase, they would be hurting themselves. The truth is, there is greater risk of financial harm by sitting and waiting.
Not only are renters in jeopardy of missing out on the historically low cost of buying with simultaneous low prices and low interest rates — after all, real estate by nature is cyclical and these conditions will change — but the actual cost of renting will rise as well.
The Alternative to Buying
Our friends at KCM illustrate our point this way: If a family continues to rent, they are looking at a housing expense which will rise with the market. Rental costs increase by 3% a year historically. But today’s rental market favors the landlord to a greater degree. Below is a graph of how rental prices have increased recently and where they are projected to go over the next few years based on a report from Marcus & Millichap.
Hoping to save by delaying the purchase of a home may result in higher housing costs while you’re waiting, thus achieving the exact opposite result.
Netter Real Estate is filled to the rafters with real estate professionals who can help you determine the most fiscally sound decision for you. We have many homes to choose from in a wide variety of price ranges and areas all over Long Island. Contact us today.
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