6 Reasons to Buy A Home in 2016
Since the 1950's only 58% of Coloradans owned their own home. Since then, 70% now own their own Colorado home. While owning your own home can be considered the American dream, it could have been challenging in the past for people to buy their first home. In 2016, we believe that it's going to be easier than ever to purchase a Colorado home. Here are six reasons to keep your eyes open and consider purchasing a home this year.
Interest Rates Are Still Low
While it may be hard to imagine, in 1981, interest rates hit a high of 18.45% for a 30 year fixed mortgage. Today, many rates hover around 4% depending on your lender and your current income and credit score. The interest rates could change at any point in time, meaning that this is a great time to take advantage of them.
Rent is Through the Roof
While homeowners are lucky and don't have to worry about rent cost - renters aren't so fortunate. In the last twelve months, rent prices have gone up, and it's predicted that they could still go up 8% more in 2016. In many areas, rent is comparable to a monthly mortgage. Why not invest that monthly payment into your own appreciating asset instead of handing it over to your landlord every month?
Home Prices are Leveling Off
Several real estate experts are predicting that home prices are leveling off. Buyers have the opportunity to capitalize on the stabilized Colorado real estate market. While the cost of homes could have been rising in the past, it looks like they could level off for a short time - but don't wait too long! Now could be a prime time to secure your home at a cheaper rate.
Down Payments Don't Have to Be Painful
While a large down payment can be an obstacle that keeps people from buying their own home, it doesn't have to be. There are many programs out there that make it affordable to get your home with a reasonable down payment even if your credit isn't perfect. A few examples of this would be the VA loan or working with the Navy Federal Credit Union. For qualified veterans, the VA guarantees purchase mortgages with no required down payment, and Navy Federal Credit Union offers 100 percent financing to qualified members of the military. The USDA's Rural Development mortgage is also a popular option and isn't always confined to farmland. Talk to your financial advisor about any options that could apply to you before signing any paperwork.
Mortgage Insurance Deals Are Available
If you decide to put less than 20% down on your home, you will most likely be required to have mortgage insurance. There can be ways to work around this, though, when you get your lending through a government mortgage insurer, such as the Federal Housing Administration (FHA). Sometimes their down payments can be as low as 3.5%, even with low credit scores. Fannie Mae and Freddie Mac have also announced a 3% down payment product that would require private mortgage insurance. This could offer you a cheaper option if you have a good credit score. Talk to your mortgage agent about options that could apply to your before signing any paperwork.
You Can Receive Tax Breaks
Buying a home could help you receive tax breaks. The tax laws continue to favor homeowners by making it possible to deduct monthly interest from taxes (some exclusions may apply). As soon as you purchase your home, you should start a folder with all of the receipts from your major remodeling and home upgrade projects as well. Some upgrades can help your capital improvements and that can change your cost basis. You can also receive tax credits for energy-saving home improvements.This can be a huge advantage to purchasing your home in 2016. Talk to your financial planner to find breaks that apply to your home.
Buy Your Home with the Best Colorado Real Estate Agent
Our team aims to help you through every step of the home buying process. We work together with you to answer your questions, help you know the next steps to take, and ultimately find the best Colorado home out there. Whether you need a small cottage or a large multi-million dollar mansion we can help you. Contact us today to start your journey towards buying a new home in 2016!
Mike@BuyWithMike.com
While it may be hard to imagine, in 1981, interest rates hit a high of 18.45% for a 30 year fixed mortgage. Today, many rates hover around 4% depending on your lender and your current income and credit score. The interest rates could change at any point in time, meaning that this is a great time to take advantage of them.
Rent is Through the Roof
While homeowners are lucky and don't have to worry about rent cost - renters aren't so fortunate. In the last twelve months, rent prices have gone up, and it's predicted that they could still go up 8% more in 2016. In many areas, rent is comparable to a monthly mortgage. Why not invest that monthly payment into your own appreciating asset instead of handing it over to your landlord every month?
Home Prices are Leveling Off
Several real estate experts are predicting that home prices are leveling off. Buyers have the opportunity to capitalize on the stabilized Colorado real estate market. While the cost of homes could have been rising in the past, it looks like they could level off for a short time - but don't wait too long! Now could be a prime time to secure your home at a cheaper rate.
While a large down payment can be an obstacle that keeps people from buying their own home, it doesn't have to be. There are many programs out there that make it affordable to get your home with a reasonable down payment even if your credit isn't perfect. A few examples of this would be the VA loan or working with the Navy Federal Credit Union. For qualified veterans, the VA guarantees purchase mortgages with no required down payment, and Navy Federal Credit Union offers 100 percent financing to qualified members of the military. The USDA's Rural Development mortgage is also a popular option and isn't always confined to farmland. Talk to your financial advisor about any options that could apply to you before signing any paperwork.
Mortgage Insurance Deals Are Available
If you decide to put less than 20% down on your home, you will most likely be required to have mortgage insurance. There can be ways to work around this, though, when you get your lending through a government mortgage insurer, such as the Federal Housing Administration (FHA). Sometimes their down payments can be as low as 3.5%, even with low credit scores. Fannie Mae and Freddie Mac have also announced a 3% down payment product that would require private mortgage insurance. This could offer you a cheaper option if you have a good credit score. Talk to your mortgage agent about options that could apply to your before signing any paperwork.
Buying a home could help you receive tax breaks. The tax laws continue to favor homeowners by making it possible to deduct monthly interest from taxes (some exclusions may apply). As soon as you purchase your home, you should start a folder with all of the receipts from your major remodeling and home upgrade projects as well. Some upgrades can help your capital improvements and that can change your cost basis. You can also receive tax credits for energy-saving home improvements.This can be a huge advantage to purchasing your home in 2016. Talk to your financial planner to find breaks that apply to your home.
Buy Your Home with the Best Colorado Real Estate Agent
Our team aims to help you through every step of the home buying process. We work together with you to answer your questions, help you know the next steps to take, and ultimately find the best Colorado home out there. Whether you need a small cottage or a large multi-million dollar mansion we can help you. Contact us today to start your journey towards buying a new home in 2016!
Mike MacGuire
Colorado Springs Real Estate Agent
The MacGuire Team
6760 Corporate Dr
Ste 300
Colorado Springs, CO 80919
719-536-4324 or 719-660-6793
Mike@BuyWithMike.com
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