Thinking about buying a home? The next few months are the time to do it.
Rates on fixed-rate loans are still appealing, and experts say it's still cheaper to buy than rent.
Here are seven reasons to buy a home by the end of the year:
1. Mortgage rates are still dropping. The average rate for a 30-year fixed rate loan is 7 to 8 percent at the time of publication. While this is higher compared to other countries, it's still an attractive rate for prospective homebuyers. The housing sector is getting stronger and inflation rates are low, which promotes low mortgage rates.
2. It's still cheaper to buy than rent. If you live on Aruba, it makes more financial sense to buy a home than rent a house, or apartment.
3. Home prices are relatively low. Housing price trends vary significantly by location and even by neighborhood, but the average housing price trends across the island look promising for prospective homebuyers.
4. It may be easier to get a mortgage. Banks may be making it easier for some prospective buyers to qualify for a mortgage. Less requirements and qualifying criteria may help some people finally get that home loan. If you have good credit and some savings available for a down payment, you might just be able to get a loan for your dream home this year.
5. Less competition from home flippers. Investors looking to buy and flip houses can't move as quickly as they did in recent years. Housing prices in some markets are increasing, making house flipping less attractive. This gives prospective homebuyers more inventory to choose from and the benefit of having less pressure to close a deal because of another pending offer. This could be the time to enjoy the freedom of shopping around for that perfect home and making an offer.
6. Avoid the cost of rising rent. A buyer's market means it might be time to say goodbye to renting for good. If you're tired of rent increases at your current location or want to move but will experience a spike in rent, consider the benefits of buying a home instead. You may be able to secure a great rate with your credit history and end up paying the equivalent or less in monthly payments as you build equity in a home. Renting can be a more affordable option for the short term, but renters still have to face rising rental costs year after year.
7. Invest in your future. Buying a home gives you a chance to start building equity, and you are investing in your future. Even if you end up selling your home in 5 or 10 years, you could profit from the sale and invest that money elsewhere. If you've been dealing with rising rent or the hassles of costly moves for the past few years, settling in to a home can stabilize your housing expenses – especially if you get a fixed-rate loan at a great rate. You won't have to worry about your monthly housing expenses changing significantly for a few years, and you will pay for something that has more value than a rental property. Consider the benefits of making this type of contribution to your future month after month.