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Is Now The Right Time to Buy?

Buy now or buy later?

In the current rapidly changing economic environment the question on nearly all buyers' minds is "is this the time to buy?" While there is no easy answer to this question, the following is some basic information which we hope will assist you and your family in deciding whether the time is right to make your move.

The rising interest rate/availability of financing dilemma

Interest rates are finally on their way up after reaching near historic lows last year and persisting below the 4% mark well into 2013. This is both good news and bad news. The bad news is that, according to a recent National Association of Realtors study, an interest rate jump of 1.5% will price approximately 3 million currently renting households out of the first-time-buyer market.

The Good News

However, higher interest rates are not all bad news. For example, higher rates means that banks are becoming less risk-averse and relaxing some of the extremely stringent lending requirements which have dominated the mortgage landscape for the last several years. According to Lawrence Yun of the National Association of Realtors, in the next few months, conventional loans could be made available to those borrowers with credit scores in the 720's rather than the 760's as has been the practice for the past several years. This amounts to 15-20% more households qualifying for loans than only a few months ago.

The bottom line

So what does that mean for you? First of all, now is the time to buy! No matter how you look at it, an interest rate below 5% is still an incredible deal and makes this an historically great time to buy property. This is especially true for first time home buyers or those with low cash reserves. Rising interest rates are sure to price these borrowers out of the market first.

However, if you are in a good cash position but have less-than-ideal credit, the rising interest rates may be to your benefit as lending requirements are relaxed in the coming months.

What is my next step?

If you are serious about buying a home and want to know what you can afford, the first step is calling your local bank and asking for a preapproval letter. This letter will give you an exact idea of what you can afford at current rates. It takes only a few minutes, can be done over the phone, and can immediately decide the question for you. If you need recommendations for local Cape Cod mortgage brokers or lending banks, don't hesitate to call us - we would be happy to point you in the right direction.

We are here to help

And if, after consulting with your mortgage broker, you decide it is time to start shopping for a new home, give us a ring - we are here to help put you in your dream home!

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Client Testimonials

We feel absolutely blessed to have been referred to Agnes and Ed Chatelain. As brokers for the estate sale of my mother’s home following her death, they took on two stressed out co-executors, both of whom lived out of state. My brother and I had little knowledge of the area or of local regulations and resources. The Chatelain’s level of expertise, energy, and willingness to go the extra mile for us was incomparable. Agnes responded to every question or concern almost instantaneously, kept us informed of every detail, reassured as needed, and deftly brought us through inspections, sale and closing with efficiency and ease. The combination of professionalism, practicality, and warmth made the working relationship an absolute joy.    

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