Property prices have been falling for a long time now and interest rates too are at extremely low levels. In addition, the government is offering a one time tax incentive to home buyers. Is this historically the best time to buy a house? Many industry insiders believe so.
House Prices Bottoming Out
Real estate prices have plummeted throughout the country ever since the property bubble burst back in 2008. Although there are no clear indications yet that a price recovery is around the corner, many analysts believe that we are close to the bottom in the housing market. There is a chance that prices could fall further but they are not likely to see a significant hit. The consensus is that further price decline would be seen only in about 10% of the markets, while the rest should soon start seeing a recovery.
Low Interest Rates
Another factor that is in favour of home buyers right now is that the interest rates are close to their historical lows. The Fed had aggressively cut rates to fight the recession and this has presented a great opportunity to lock-in a mortgage contract at attractive terms. This situation is not going to last forever. As the economy improves, the interest rates are also likely to go up.
Yet another benefit of buying a home right now is the tax incentive being given by the government. If you buy a home right now you can get a tax reduction of up to 10% of the value of the house, but not exceeding $8,000 for people buying a house for the first time and $6,500 for existing home owners. Again, this incentive is not going to last forever, and the deadline to avail this offer is April 30.
There are many advantages of buying a house right now, but you would have to start looking quickly if you want to benefit from the tax incentive. Two months may seem like a long time, but buying a house is a big decision and you don’t want to rush it by leaving the search to the last moment.
You should also know that if you already own a house, and want to sell it to buy a new one, it won’t be all that easy to make a sale at a good price in the current market. You may have to compromise on the price if you want the deal to be executed quickly.