Some economists believe America’s recession is over, and that expansion will resume soon. A strong growth rate of 2.4 percent could occur in the third quarter, says Macroeconomic Advisers, a respected forecasting firm. Often we don’t hear about recoveries until they’re many months old. A big reason is that the media report economic data that’s already old.
Retail sales, for instance, are reported weeks after that spending took place. Finding out how strong sales were 45 days ago doesn’t tell us what’s happening in stores now. Many economic figures also are “lagging indicators” which pick up only after growth has recovered. Consumer spending will increase once households find their finances are improving.
New guidelines from the Federal Reserve recently went into effect to make certain borrowers receive information from mortgage providers on a timely basis. Lenders now must comply with the following:
Over the past few years the fundamental reasons for owning real estate haven’t changed. In fact, today’s low rates and bargain prices make it a compelling time to look into purchasing. Our recent period of rapidly-escalating home prices encouraged some Americans to view houses as something which they aren’t. Historically houses have been solid investments, but not spectacular ones.
Homes have reliably risen in value at a pace slightly faster than inflation. But they’re not a means for getting rich quick – at least not for the vast majority of us. At its most basic level, a house is a place to live. The best time to buy one is when you need to move into a new home. You’ll receive tax benefits by claiming deductions on your mortgage interest and property tax payments. And you can expect to see your home’s value go up over time. But no one can be certain about how property prices will move, so it’s risky to attempt to time the market. Think twice about purchasing if you don’t plan on staying put for at least a few years.
Mortgage rates remained low during the summer, providing Americans with good reasons to look into purchasing a home or refinancing their current loan. Recently rates on 30-year mortgages were more than one percent below their levels of a year earlier. Homeowners with a $300,000 loan could save $213 each month as a result. Over a year their savings would reach $2,556.
It’s actually surprising that rates would stay near all-time lows, even as America’s economy is improving. Generally a healthier economic performance soon leads to rising interest rates. Yet America’s Federal Reserve remains committed to keeping rates low. A recent statement from Fed Chairman Ben Bernanke indicated that rates would stay around today’s levels “for an extended period.” Certainly at some point rates will go up – and no one can be certain when that will occur. Today’s great home values and attractive rates are making it easier for Americans to purchase real estate now.
Get in touch with us soon, and you’ll be in position to gain the maximum benefit from our current bargain rates. We’ll show you how purchasing a house can fit into your household budget. Or we can review your current mortgage, and see if you’d come out ahead by refinancing now. If the advantages of a new mortgage aren’t apparent, we’ll watch the market for you, and let you know when you can obtain a loan on preferential terms.
Today many households are discovering creative ways to make a home purchase possible. One strategy is to consider sharing your home in order to reduce your payments. Often families have a member who is struggling to get by on their own, and wouldn’t mind living with people they know. Your parents or children may appreciate the benefits of having a room at a discount to what they’ve been paying for a place to live. Both parties gain by combining households and saving on total shelter costs. Even if you need to add on to your house to make the situation work, it can be a smart solution.
BIGGER SAVINGS
Look into buying a fixer-upper home, and letting your skills increase the property’s value and usefulness. Almost anyone with the interest and time can complete many improvement projects on their own. Another way to find an affordable home is to purchase a smaller or older house. Remember that you can always upgrade your home in the future. Taking a hard look at our expenses also usually reveals places where we can cut back without depriving ourselves of anything essential. Write down where every dollar goes, and then think about regular expenses which you could reduce or eliminate. We’ll help you obtain mortgage financing on better terms by going over your credit report with you. We may find ways to boost your score, so you can obtain a lower borrowing rate. Start your home purchase process by talking with us about the financial details. You’ll find that we’re on your side from the time you start looking at houses until you move in.
Over time the steady appreciation of property allows you to build a sizable profit. And most Americans can sell their home without paying tax on that increase. Stocks don’t offer the same advantage. In fact, many experts predict that capital gains tax rates on stocks will go up in the near future.
Paying off your mortgage can give you the freedom to retire without having any housing expenses. If you choose to move to a smaller home, you may enjoy a profit which will increase your retirement savings. A recent lull in the real estate market is a natural reaction to a period when expectations and activity became overheated. Yet the time-tested reasons for being a homeowner remain as true as ever. Contact us when you’re ready to make an important home purchase.
