Summer greetings to our friends and neighbors!
Last July, when interest rates were at historic lows, we advised that buying a home, especially if you were renting, would save you a small fortune over time. Many people took advantage of those low rates, and as a result, the housing market has been hot. Now some would-be-buyers are wondering if they have missed out. Has the market passed them by? We don’t think so and here is why:
- The heart of the millennial generation is reaching the age when people are ready to settle down and buy a home, keeping the demand for housing strong.
- Incomes are rising so many people are willing to pay more monthly to meet their housing needs.
- Rents, in many locations, have climbed dramatically making homeownership more attractive by comparison. The chart below, with data from the U.S. Census Bureau, shows the escalating cost of rent over the last 10 years.
This summer we are here once again to say that homeownership deserves your serious consideration unless you plan on relocating within the next few years. Interest rates continue to trend downward and as of the first week of July, they are as low or lower than last year. When compared with renting, the cost of homeownership is surprisingly low for many despite the increase in home prices we have seen this year.
You might be wondering how much this run-up in prices has impacted the monthly affordability of a home? The amount is likely a lot less than you would have guessed. Check out the comparison of median-priced 4-bedroom single-family homes from the western suburbs of Chicagoland and consider how attractive the total monthly mortgage payments are, especially when compared with renting:
DUPAGE COUNTY
KANE COUNTY
Data: *Interest rate data from FreddieMac.com. Call for further conversation regarding chart data or for your personalized rate quote.
If you have questions about what buying your first home or a different home might mean for your unique needs, then please reach out and we will provide you with information that is customized for you. Also, if you know anyone who would benefit from this information, please pass it along and encourage them to contact us as well.
Lastly, rates are still very low, so if you want to consider refinancing or know others that might like to take advantage of the current rates, we are ready to help.
Have an enjoyable summer. We hope to hear from you soon.
