We go over many of our buyer concerns on our blog and usually, one of the most common ones is, "Is right now a good time to buy", accompanied by, "Is right now a good time to borrow?" Depending on what your finances look like and how much you have saved for a down payment, it is almost always a good time to invest in real estate. Even with limited inventory, inflation, and increasing interest rates. Let's talk about why this is the case
and why you should not necessarily delay home ownership plans in the face of inflation.
First, housing is an asset that over time grows in value so if you have cash and would like someplace to put it so it does not lose value, housing is a great option. Ali Wolf, economist at Zonda posits "If you have cash and are expecting inflation, you want to think through where you put your money so it does not lose value." Our advice is real estate in The Research Triangle. We have had steady increases in value and equity in The Triangle and do not anticipate this trend reversing over the next several years as we continue to see steady increases in job growth as well as an influx of people moving into the area.
Second, a mortgage stabilizes housing costs. Bankrate Senior Wealth Adviser James Royal said, "A fixed mortgage allows you to maintain the biggest portion of housing expenses at the same payment. Property taxes may rise and other expenses may creep up, but your monthly housing will remain the same. " When buyers find themselves worrying about inflation, it really is not about the housing market, it is other factors. Housing on the contrary is one of the safest investments. In fact, investing in real estate has been shown to help protect your wealth, instead of diminish it. Remember a portion of each monthly mortgage payment is paying down the principal, in other words it's the same as putting money in the bank.
Third, Buying protects you from rising rents. An advisor at Forbes, Natalie Campisi, opined that "Homeowners are shielded from mounting rental prices because their cost is fixed, regardless of what is happening in the market; Tangible assets like real estate get more valuable over time, which makes buying a home a good way to spend your money during inflationary times. " If you are still renting, and are shocked by how much these prices are going up, we strongly suggest you consider buying.
Mark Fleming, Chief Economist atFirst American,;identifiesa key reason why home prices won't depreciate or drop:
"In today's housing market, demand for homes continues to outpace supply, which is keeping the pressure on house prices,so don't expect house prices to decline."
My NC Homes specializes in Raleigh Durham, Chapel Hill, and across the Research Triangle Park and have assisted thousands of homeowners and homebuyers with their transactions. We are truly experts in new and existing construction and we believe our expertise has afforded us one of the best reputations in The Triangle. If you are a first time home buyer and would like to see how home ownership can become a reality for you, contact us today!
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