June 15, 2018 | by Laura Ross
Categories: First Time Buyer, Homeownership
In a recent article on realtor.com, Javier Vivas, Director of Economic Research for realtor.com discussed the reasons for why 2018 could be a great year to stop renting and make the leap into homeownership. The article highlights the key reasons about why now is the time to consider buying a home.
Rates are rising
Interest rates are starting to rise after years of record low mortgage interest rates. The rate for a 30-year fixed mortgage rose to 4% in 2017 and Vivas predicts we’ll see more increases in 2018. These increases will limit the affordability of many homes. The longer you wait, the more expensive it will be to purchase a home.
The overall increase in home prices is slowing down
Price increases in 2018 are expected to be moderate after years of swift growth. Vivas forecasts a home price increase of only 3.2% compared to a 5.5% increase in 2017. Existing home sale prices are predicted to increase 2.5%. While there are significant variances in home prices across different markets, overall Vivas predicts that the slower growth will enable many buyers that were previously priced out to finally be able to purchase a home.
Available Inventory is Increasing
The housing inventory shortage of the past few years has either forced buyers to settle for homes that weren’t exactly what they wanted, or has kept them from buying entirely. This is likely to change in 2018. New home construction is expected to expand, and builder confidence is at its highest level since 1999. Despite ongoing challenges with the costs of labor, land and materials, Vivas believes that hope is on the horizon and home buyers will finally start to see more homes in their price range.
Taxes
While the new tax plan eliminates the mortgage interest tax deduction for those above a certain threshold, many taxpayers will see a tax cut. Vivas believes this increase in disposable income could spur demand from those currently renting who want to start building equity in a home they own.
If 2018 is the year you decide to purchase a home, TSAHC can help. We offer both down payment assistance and mortgage tax credits to first-time home buyers and existing home owners. Our Home Sweet Texas Loan Program offers low, fixed rate mortgages along with a grant of up to 5% of the mortgage amount that can be put towards their down payment and/or closing costs.
TSAHC’s Mortgage Credit Certificate (MCC) Program is specifically for first-time buyers. With an MCC, home owners are allowed to claim a credit on their income taxes of up to $2,000 every year for the life of their home loan. First-time buyers can use TSAHC’s DPA and MCC programs together.
Click here to find out if you qualify for our programs.
To celebrate June as homeownership month, TSAHC is focusing our blog posts this month on promoting the benefits of our Home Sweet Texas program and sharing home buying tips for newlyweds, renters, and millennials.
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Summer is a great time to purchase a new home! Before making the purchase, however, it is important to inspect it thoroughly so you can discover if there are any major problems that need to be fixed, such as needing a new roof.