For many people, buying a new home is a huge and scary decision. The market is changing, mortgages are confusing, inflation is rising and there's so much to consider when making such a big purchase. So why should you buy a home now?
Well, believe it or not, this might be the perfect time to take the plunge. Here are 5 reasons why financing a new construction home now could be the best decision you'll ever make.
Rising Interest Rates
Interest rates are on the rise and they're not expected to go down anytime soon. If you're thinking about buying a new home, now is the time to act!
Just this year, the Federal Reserve raised interest rates twice, and they're currently sitting just over 6%
nationally. This is a steep hike from the 2.65% we saw as recently as last year.
But here's the thing — historically, the average interest rate
over the past 30 years is about 7.77%. So while we have seen significant increases, we are currently at a rate that is still lower than average historically. With projections for rates to continue increasing, if you’re considering a home purchase in the near future, now may be the best time to lock in that rate.
And remember, if rates drop significantly in the future, you can refinance to lower your monthly payments.
It’s Not All About the Rates
There’s a lot to consider when deciding if now is the right time to purchase and your mortgage rate is just one part. When looking at how much you will spend over the course of the loan, many factors come into play. Your down payment, credit score, loan type, loan term and loan amount will all affect your overall loan package.
The first step is figuring out your budget for a new home. Getting pre-approved with a preferred lender
will help determine how much you can afford to spend and how different variables will affect your payments. For instance, if you have a good credit score, you may qualify for lower rate loans. If you can afford to put down a higher down payment, you may be able to eliminate private mortgage insurance (PMI) which could significantly lower your monthly payment.
It’s a lot to navigate and mortgages are not one-size-fits-all. Our trusted lenders offer a variety of programs, so you can compare all your options and find the loan that is perfect for you.
Better Financing Options
If you're worried about qualifying for a mortgage, don't be. There are a number of new financing options available that didn't exist 10 or 15 years ago. There are even ways to get approved for a loan without a down payment. Options like FHA loans
or VA loans make it possible for just about anyone to buy a new home.
When Caruso Homes teams up with a lender, we're recommending them because they have special programs, competitive rates and terms that buyers need to get into a new home. And, because they value our partnership, you can be sure they will provide exceptional customer service throughout the entire process. They may also offer special incentives and contribute additional funds toward closing to help lower some of your costs.
Predictable Monthly Payments
Rent is out of control in many parts of the country, and it's only going to go up. In fact, the national rent average increased over 11%
just last year!
With the variety of financing available today, you may be surprised to find that you can afford a new home for close to what you’re paying in rent. And, with a fixed-rate mortgage, your monthly payments will stay the same over the life of the loan. So while others continue receiving rate hikes from their landlord, your monthly payment will stay the same.
And don’t forget the potential tax benefits of owning a home. Many home buyers qualify for tax breaks that will save you money at tax time.
It's no secret that the last several years have been a "seller's market.” This is when there are more buyers looking for homes than there are houses available. This often leads to multiple offers and even bidding wars, which can drive up the purchase price well above the listing price.
Plus big investment firms
have been offering cash way over the asking price to buy pre-owned homes as rentals, so there's even more competition than in the past. And this makes life especially hard for first-time homebuyers who want a little slice of the American dream.
But with a new construction home, you typically won’t be competing against other buyers. It's just a matter of getting pre-approved and working with the new home builder to find a home
and community that fits both your needs and your budget.
Ultimately, while financing plays a large factor in your decision to buy, there are many other factors that come into play. Your family may be growing, your career is changing or your lease is ending. These are great reasons to buy, no matter what the market is doing.
If you're thinking about buying a new home, Caruso Homes has a wide variety of new homes available in communities all over Maryland, North Carolina, Pennsylvania and Delaware.
We make it easy to find the perfect new home for you and your family, and our preferred lenders can help you get the financing you need to make your dream a reality. Contact us today to learn more!