Is now a good time to buy a home?

Keynote speeches:

• If you can afford it, now may be a good time to buy a home.
• Median It followed a 16-month annualized profit of $435,000 in October.
• Daily average mortgage rates topped 7% and have moved up from the lows since September, but are still below 2023 levels.
• There is a decrease in inflation The Fed will cut interest rates twice in two months brings uncertainty.
• However, the market : More buyers entered the market after the election, higher rates, increased prices and .

As the year winds down and the dust settles from the election, many home buyers are wondering if now is a good time to enter the market. The apartment still remains for most of the country, above all, and showing little signs of improvement. Given these challenges, it's only natural to wonder if now is the right time to take the plunge.

Whether or not it's a good time to buy a home comes down to whether or not it's a good time for you for . “Should I buy a house now or wait?” To answer, let's dig a little deeper into the market and spot the trends.

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What is happening in the housing market?

Here are some key market trends to keep an eye out for and help you make an informed home buying choice.

Home prices: Sky high and still climbing

The average selling price in the US is currently $435,000just shy of the all-time record. Home prices have made year-over-year gains for 16 months and are more than 45% higher than in 2020.

A; also, median It sits around $2,600, a slight drop from last year.

Mortgage interest: High and volatile

Daily average 30 year constant It increased to 7.08% – down from April's high, but well above last September's lows. Rates are rising faster-than-expected job growth and election jitters, even with the Fed cutting two percent.

Cuts are likely to be only 200 bps (2%) by the end of 2025, but mortgage rates are still unlikely to fall below 6% in 2025.

Supply: It is limited

The months of supply have varied between 3 and 4 months for the past yearclose to a balanced market. Less than ~4 months supply favors sellers; Often prefers buyers older than ~4 months.

New construction has also decreased in recent months. The reason for this is hitting the market, and builders have slowly pulled back since the pandemic-driven boom. New apartments have started in October.

Demand: It is slowly coming back

Expected US home sales are retreating and Redfin's Home Buyer Demand Index hit its highest level in nearly a year and a half.

Other metrics are less convincing, such as new listings holding steady and the share of sales going under contract in the two weeks falling.

Inflation: To fall, but with an uncertain future

Thanks in part to the Fed on pandemic-related inflation, there is inflation Close to the 2% target. This is a major breakthrough Post-pandemic inflation to reach 9.1% in July 2022.

Lower inflation means less spending on goods and services, which can help shoppers' budgets.

Although important, Trump's policies could reignite inflation, so it's unclear what lies ahead.

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Home sellers must prepare for competition

Recent drops in mortgage rates are setting the stage for more buyers to enter the market, which means more competition for listings.

This is because house hunters fear high mortgage rates for years, especially as inventory has been marked down due to sellers wanting to maintain their pandemic-era prices (). Now that rates are falling, more buyers are deciding to enter the market.

Will mortgage rates fall further in 2024?

Today's mortgage rates reflect what investors think the Fed will do. Investors believe the Fed is curbing inflation and expect mortgage rates to remain steady through the end of the year. Economists' expectations for the near future are much foggier than Trump's expectations .

In other words, economists don't expect mortgage rates to fall any further than they already are because interest rates have already priced in the recently announced rate cuts. However, factors such as inflation and employment data may change experts' views.

Should you lock in your mortgage rate today?

Now is a great time if you can . Rates have not been this low for nearly two years.

Lower interest rates mean you can qualify for a larger loan amount or enjoy lower payments within your current budget. If rates are still too high, you can also. It also needs to act now to avoid likely price hikes as competition heats up in hopes of avoiding mortgages altogether.

So, is now a good time to buy a home?

If you can afford it and are ready to own a home, now is a good time to buy a home. Waiting for rates to drop puts you at risk of increased competition from buyers and subsequent price hikes from sellers. Prices are lower than a year ago and sales are also lower but so now may be the time to act.

Buying a home now also means you're maximizing your investment potential. Low interest rates save you money over the life of the loan and mean more for you can go towards building capital.

However, it should be noted that there is a market recently. For example, higher mortgage rates typically lower home prices, but over the past two years it has had the opposite effect. Also, reduced inventory usually leads to more competition, but prices have been too high for many buyers to afford, causing some homes to go unsold and others to sell within days.

It is important to be prepared for any surprises that may come your way.

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Final thoughts

If you have and feared high rates, now is the time and start your home search. Prices are likely to remain stable for the foreseeable future, but buyers are getting restless, helping the market gain momentum. The longer you wait, the more competition you'll see.