A real estate agent will always say yes when asked if it’s a good time to buy a home. But, today’s market offers an unprecedented opportunity. Let me explain.
First, take mortgage rates during the peak of the bubble in 2007
30-year mortgage rates were in the low to mid 6% range. Today’s rates are in the low to mid 4% range, a drop of 33%.
Next, the median price for a single-family, resale home in Sonoma County peaked at $618,450 in August 2005. It bottomed out at $305,000 in February 2009.The median price has averaged over $327,000 since the beginning of the year. Yes, you missed the bottom!
O.K., so you are afraid to buy because you don’t know where home prices are going. Well, no one has a crystal ball, and, as Wall Street is fond of saying, the past is no predictor of future results. But, with the Fed saying it will keep interest rates low for the next two years, that should put upward pressure on prices.
I am presently working with two buyers that are taking advantage of this market. One sold their home at the height of the market and has been renting. I am sending them any new listings that come on the MLS that fit their criteria and they are making a drive by of each one and then calling me if it is something they want to see.
The other buyer is a long time client of mine that has the first home he bought from me and he is renting it out! He bought a new home, and then last year another small house to add to his rentals. Now he is looking at a fourplex that sold for over $700K in Rohnert Park. It is presently priced at $535K and he may make an offer later this week.