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Movin’ on up!

Movin’ on up!

Has there ever been a time in history where there was such a perfect storm for real estate buyers? Consider this:

1) The government is paying you to purchase a home. (Old post, program ended…)
2) The housing affordability index is at a record high (the ratio of income to housing prices – this allows economists to even out for inflation) meaning that housing is a lower percentage of your income as it has ever been.
3) Interest rates are really really good.

You might be tempted to think “This all sounds good, except for I own a house already. I can’t afford what I’ll have to lose to sell it”. No one’s denying that prices have gone down. However, some price ranges have taken a bigger hit than others. Consider this chart which lays out the months of inventory per price range:

0-49,999 3.0
50,000 to 99,999 8.1
100,000 to 149,999 9.0
150,000 to 199,999 13.1
200,000 to 249,999 15.5
250,000 to 299,999 18.8
300,000 to 399,999 23.8
400,000 to 499,999 38.7
500,000 to 599,999 29.2
600,000 to 699,999 54.5
700,000 to 799,999 76.0
800,000 to 899,999 50.0
900,000 to 999,999 57.0
1,000,000 or Over 83.1

This just means that at the current rate of sales, it will take 3 months to completely sell out of homes under $50,000 but will take almost seven years to run out of homes over a million. Because of the law of supply and demand typically there is more downward pressure on pricing when there is an oversupply. So if you’re in a price range with a smaller supply of inventory (up to $150,000) you’ll probably take less of a price hit than the house you’re moving to.

Don’t forget that the government isn’t just paying first time buyers, they’re paying current homeowners as long as they’ve been in the current home for 5 years. This is an amazing time to move up! Call or e-mail me if you’d like a consultation on if it’s a good time for you.