4 Reasons 2016 Is The Best Time To Buy A Home

First-Time-Home-Buyers

2016 is the time for renters to get off the sidelines and seriously consider homeownership.

San Diego Annual App-01
Source: NeighborhoodScout.com

Given the recent downturn in the housing market, it’s understandable that renters may feel nervous about purchasing a home. However, if you look at the housing prices in the last 3-5 years, real estate prices have been steadily increasing about 8% each year.

The key economic indicators show there are 2 major changes in the mortgage process that will help home buyers:

  1. Interest rates are historically low

Current interest rates are holding near the 4.0% rate. The Fed has kept interest rates low because of their concern about the economy. Interest rates this low haven’t been seen in 30 years. It was the Federal Reserve’s way of stimulating the economy after the great recession.

  2. Clear Mortgage terms

The new TILA-RESPA integrated disclosures known as TRID have mandated clearer terms at the closing table. For first-time homebuyers, this is a huge benefit because it is designed to ensure the borrower has no surprises at the close of the transaction. These new terms will help homebuyers better understand both their financial commitment and what is expected of them.

These are great reasons why now is a better time to buy than ever. Additionally, you don’t want to wait much longer:

  3. Interest rates will soon rise

The federal reserve raised interest rates during their Dec 15-16 policy meeting in 2015. It was a small increase, but rates will only continue to rise.

  4. Rental prices are on the rise.

In San Diego alone, the number of new apartment buildings being constructed is at an all time low. Nearly 120,000 new residents move to San Diego each year. This doesn’t include the 25,000 new residents due to birth rates. Unfortunately, the housing industry only builds about 40,000 new units each year and as a result, there is less inventory and more demand. The newer apartments that are being constructed are also class A rental units that rent for $2-$3 per sqft. Average rent for these units range from $2000 – $3000/month.  With prices that high, you might as well consider buying a property with mortgage rates at the same price.


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Scott Cheng - Real Estate Broker

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  1 comment for “4 Reasons 2016 Is The Best Time To Buy A Home

  1. January 30, 2016 at 9:47 pm

    Interesting blog! Is your theme custom made oor did you download it from somewhere?
    A theme like yokurs wuth a ffew simple tweeks would really maoe my blog jump out.
    Please let me know where you got your design. Many thanks

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