If your New Year’s Resolution is to buy your first home, you’re not alone! In fact, real estate agents anticipate that first-time buyers and Millennials will make up the largest share of home shoppers in 2017.
While predicting the real estate market is notoriously difficult, industry experts warn that 2017 might be even more unpredictable than usual. There are a few things that we can reasonably expect, though – including rising mortgage rates. Following the election, mortgage rates climbed 50 basis points (or half of a percentage point) in just a couple of weeks. While these higher rates will certainly affect homeowners wishing to refinance, its unlikely to pose any significant difficulties among homebuyers. Generally speaking, when mortgage rates rise, home price growth slows, so the overall price of buying a home isn’t expected to rise considerably.
The spring real estate market is likely to be very busy in 2017. As demand for homes continues to outpace the supply of homes for sale, we anticipate a competitive market with bidding wars common among buyers. As a result, it’s likely to remain a seller’s market in much of Greater Philadelphia, particularly among the closer suburbs to the city,. The best advice we can give to buyers is to have all of your financial ducks in a row before seriously shopping for homes. This means having a preapproval letter in hand from a lender, because you’ll need it when submitting an offer.
If you plan on looking for a home in the earlier part of the year, be sure to file your taxes early because your lender will want to see the latest information regarding your finances. And if you’re lucky to receive a tax return, it’ll be a great jumpstart on your down payment!