The report also stated: “At the current pace of sales, the inventory represents a 4.6-month supply, a considerable improvement from the 2.7-month supply posted a year ago. A balanced market, where neither buyers nor sellers hold a clear advantage, emerges when the supply hovers between a 5- and 6-month inventory.”
As Andrew Walter, president of the Association’s Santa Clarita Valley Division says, “Buyers who understand that this is a favorable time to purchase a home – low prices and incredibly low interest rates – are making great deals, yet too many prospective buyers say ongoing concerns about the health of the economy and the security of their jobs are making them hesitate.
It is clear that this is an extraordinary time to purchase a home. The median sales price has risen from their historic lows and mortgage rates are the lowest they have been in our lifetime. In today’s economy, many factors influence the decision to buy a home – job status, financial resources, and family considerations among them. But one of the most compelling reasons to consider becoming a homeowner in the current market is the affordability factor.
To put this into perspective, a buyer who purchased a median-priced home five years ago with an FHA mortgage requiring a 3 percent down payment would have a monthly mortgage payment of $1,650.00. With today’s interest rates and median home prices, that same buyer would be paying $1,150 per month – that’s a $500 savings every month, and a savings of $6,000 per year.
These home prices and interest rates will not remain this low forever, so if purchasing a new home is in your future don’t wait too long, or you may find that window of opportunity has closed forever.
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