Two Questions You Should Ask Yourself If You’re Thinking of Buying a House

You’re probably paying attention to everything you hear about housing when you’re considering buying a house. You get your information through a variety channels: the media, social media, your agent, conversations with family and friends, overhearing a conversation at the supermarket, etc. Home prices and mortgage rates will probably be mentioned a lot. Take a look at the data to help you cut through the noise. As you make your decision, here are the two most important questions you should ask yourself: 1. What is my opinion of the direction of home prices? The Home Price Expectation Survey by Pulsenomics, a survey of over 100 economists, real-estate experts, investment and market analysts, can provide you with reliable information. According to the latest release from Pulsenomics, the experts surveyed project a slight depreciation in this year’s home prices (see the red on the graph below). Here’s what you need to know. In many markets, prices are now increasing again. The small 0.37% decline HPES shows for 2023 is not the crash that some people predicted. Let’s now look at the future. The green in the graph shows that prices have turned the corner and are expected appreciate in 2024. The HPES predicts that home prices will return to normal levels in the coming years. This means that your home’s value will increase and you can gain equity in the future if you purchase now. According to these forecasts, if you wait, you will end up paying more for your home in the future. What Do I Think Will Happen to Mortgage Rates?Over the last year, mortgage rates have increased in response to economic uncertainties, inflation and more. The latest reports show that inflation is still high but has moderated since its peak. This is a positive sign for the mortgage market and rates. When inflation falls, mortgage rates tend to fall. Some experts believe that mortgage rates may fall over the next few months and settle between 5.5 and 6 percent on average. But, even they cannot predict with certainty what mortgage rates will be in the coming year or next month. There are many factors that could affect what happens. Here are some things to consider to help you see the different outcomes:
If you buy a house now and the mortgage rates fall as projected, you probably made a good choice because you bought it before home prices increased. You can always refinance if rates fall.
If you buy and mortgage rates go up: You made a good decision if this happens because you bought the home before the price and the rate of the mortgage went up.
Bottom LineIf you are thinking of buying a house, you should know what to expect in terms of home prices and mortgage interest rates. Expert projections are a great way to stay informed, even though no one can predict the future. Trusted real estate professionals can provide an expert opinion about your local market.

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