Why 2020 Is A Great Year to Buy Your First Home

2020 has been a memorable year for a lot of reasons—and there’s been plenty of analysis, debate, and confusion about the state of the housing market.

With historically low mortgage rates, is now a good time to buy a home? Although it certainly depends on your individual situation, there is plenty of evidence that shows securing your dream home now might be the perfect decision.

Is it time for you to make a move?

As many of our lives now revolve around doing everything from working, learning, socializing, and relaxing from the comfort of our homes, many of us have taken a close look at what we really want from our space—not just what we need.

The majority of homebuyers on the market right now are millennials, but why? Well, according to John Burns, a real estate consulting firm, many millennials are growing their families and ready to make the transition from renting to becoming homeowners.  

And it’s a pretty large number making the move: in August, first-time homebuyer activity rose 19 percent from July for the highest month ever for Freddie Mac. 

• Renters

  If you’ve ever rented, you know that your monthly payments are subject to change at any time—and with historically low mortgage rates, many people are realizing that buying a home might actually be more feasible than renting.

  An additional factor is individuals or families who may be living in dense high-rise apartments with limited space for social distancing.

• Growing families

  If your family has already assembled all the puzzles and played every board game in the house, cabin fever has probably set in. Many of us are looking for more space for our home offices, a backyard for recess and social-distanced fun, and simply more space to make living easier. 

Go big. Pay less. 

You’ve probably seen a headline or two about today’s low mortgage rates. And it’s true: according to Freddie Mac, the rate is 2.87% on a 30-year fixed-rate mortgage and 2.35% on a 15-year option.

An article from Redfin explains the impact this decrease can have in your home search and monthly mortgage payments: “At a 3% mortgage interest rate—roughly the average 30-year fixed rate for July and August 2020—a homebuyer can afford a $516,500 home on $2,500 per month, up from the $483,250 they could afford on the same budget when the average was 3.77% in July 2019.”

While many wondered if housing prices would decline after the coronavirus shutdown, we’ve seen the opposite occur. According to Realtor.com, median listing prices are actually 5.6 percent higher than they were in 2019. So if you’ve been wondering if you should wait to purchase a home with the assumption that prices will fall, it may be an impossible feat. 

Of course, every situation is different—and although U.S. mortgage rates are certainly low, we are officially in a recession. And only time will tell where the real estate market and the economy might be headed next.

The Colina difference.

We know that these are uncertain times—that’s why we’re committed to providing personal service at every step of the way. 

If you’re seeking support in evaluating what you need from your new home, let us help. We offer luxury homes in a variety of different communities so you can find a place in the perfect spot—with all of the amenities you and your family needs.

Call us today to set up a tour, speak with an agent, or schedule your virtual tour.