Video Transcript
It’s March – the month of spring – and many of you have a housing decision coming up – Renew your lead and rent for another year – or buy a home now. Well we have the data to help you. Let’s get into it.
[Homebuyer.com doorbell makes your dogs bark] I’m Dan with Homebuyer.com. We are the mortgage company for first time home buyers. Let’s jump right in.
So is now a good time to buy your first home? March 2024. The tl;dr – if that’s what you’re after – is “yes” – it’s a good time to buy a home.
Thanks for watching. Don’t forget to subscribe. Have your pets spayed or neutered.
Now – for everyone still here – let’s go deeper – into WHY it’s a good time to buy your first home – because it may not be obvious at first glance – what with mortgage rates higher than what they were in January – and home prices higher, too. So let’s approach this with real-time data. For the market today.
So you can feel comfortable and confident – and look back a year from now – in 5 years – 10 years – and say “I’m glad I bought in March. I’m glad I didn’t wait.” Also – this video is for first-time buyers. Let’s call that point out.
It’s not for investors – or fix-and-flippers – homeowners sitting on 3 percent rates. This is for renters making a choice – about whether now’s a good time to buy a home. And we’ll talk about three data points that support the analysis – starting with point number one: mortgage rates.
Mortgage rates are already this year’s big story. Rates kicked off 2024 on a 10-week winning streak – the longest consecutive drop in 30-year rates in more than a decade. Rates are a little higher now but they’re still down from last fall – more than a percentage point for a lot of buyers – and with every one percentage point – that mortgage rates drop – the amount of home – that you can afford to buy as a buyer – it increases 11 percent.
That’s an important number because home prices climbed about half of that 11 percent last year – which means today’s lower mortgage rates are keeping home affordability in range. If you want to check today’s mortgage rates, they’re on the website at Homebuyer.com.Plus! Today – eligible first-time buyers still get access to automatic mortgage rate discounts – through the FHFA First-Time Home Buyer Mortgage Rate Discount program – you don’t apply for it – you just get it – and FHA-backed home buyers pay less too because – last year – the agency lowered its mortgage insurance rates.
But the thing about mortgage rates is this: you can’t time them and nobody really knows what they’re going to do next. You might think you have all the answers – but then the market changes the question. So, don’t shop for homes with the idea that rates will definitely drop later.
Maybe they will, maybe they won’t. But two things that we likely do know – your rent is going up – that’s almost for certain – home values are, too. Which brings us to the second reason why now is a good time to buy: There are way more buyers than sellers right now and that is the textbook condition for rising home prices.
And this is a great point to briefly point out – loudly – that the home price crash – that the news – that your uncle – that the people in my comments – said was definitely coming – that crash – it never came. And it won’t. Because for housing to crash – there would have to be a tremendous influx of new homes listed for sale – at the same time that today’s active buyers magically disappear.
That’s what causes a crash – and there is so much pent-up demand right now – that even if – a wave of homes just dumped on the market – there are literal millions of buyers who have been sidelined these last two-plus years – that would see those homes and snap them up. Housing isn’t poised to crash – and there is nothing that suggests it will – and anyone who tells you differently – is using you for clicks. Because you can see – with your own eyes – that there are way more buyers than sellers – in nearly every city, on almost every street, in every community.
It’s true that home sales are generally down. In raw terms – they are. Sales volume was its lowest in 30 years last year.
But, sales are down because the shelves are bare. There is just 3 months of home supply right now, and that’s a seller’s market, friend. There is no balance between buyers and sellers.
There are lots of buyers over here. And not a lot of sellers over here. So, that’s reason number two why now is a good time to buy.
Prices will be higher in the future. You’ll pay more to buy the same home. Reason Three is a little different.
It relates to market momentum – and psychology. It gets into seller greed. Because buying a home – or selling one – is more than a financial transaction for buyers who plan to live in their house – it’s also an emotional one.
I mean – this is your home. And the emotions of buying and selling a home – which can include excitement and pride – also include fear and greed – on both sides of table. And that determines how your negotiations go.
Right now – with home prices rising and demand for homes up – sellers feel less fear than a year ago and have moved this way toward greed. They’re making you rush to offer – and bid up your price – to protections. Sellers are making fewer price reductions.
Greed – is rising – and that makes it harder to get a great deal. Your ability – as a buyer – to afford a home – interest rates notwithstanding – will get worse. You will pay more.
You will get fewer concessions. Sellers know that this market – is theirs. Another reason why now is a good time to buy.
Later this year will show more greed. Now – there are some wildcards here – specifically with Congress – and first-time home buyer programs in discussion. We’ve talked about the $15,000 first-time home buyer tax credit here – the $25,000 cash grant for first-generation buyers – the LIFT Act mortgage which lowers rates below 2 percent – none of those look poised to pass in the next few months – but two other programs are coming to the front.
First – the HELPER Act – a 100% mortgage for teachers and first responders. That bill has bi-partisan, bi-cameral momentum and that could pass into law sooner. That’s the HELPER Act.
And – also – the FHA right now is sitting on a huge pile of cash. The agency has 5 times its minimum reserves – so the FHA could decide to lower its mortgage insurance premiums for the second time in two years – which is something the FHA could do on its own – without the work of Congress – which would help buyers, too – with lower monthly payments – less insurance paid. 19 percent of first-timers use an FHA-backed mortgage.
As always – we watch these developments so you don’t have to – we write about them in our newsletter – we talk about them here. Subscribe to both for more information. And be a better buyer.
So that’s it – the reasons why March 2024 is a good time to buy a home. It’s not the best time in history – not even close – that was mid-year 2020 if you ask me – but this month – relative – is a month to stop renting and start owning – if you have that choice. [OUTRO] If you liked this video, subscribe for mortgage program updates and first-time buyer assistance.
And when you’re ready to see how much home you can afford, get today’s current rates and our immediate mortgage approval on the site – in as little as 3 minutes – with no paperwork. I’m Dan with Homebuyer.com, the mortgage company for first-time buyers. Happy homebuying.
