Whether you are buying a house to live in yourself, flip, or retain as an income property, it is a big decision to make. And this year may be particularly challenging on the homebuying front. Here is what you need to know.
Housing inventory is limited.
As of December 2020, housing inventory stood at just 1.07 million units for sale. That is a 23% year-over-year decline. It also represents a mere 1.9-month supply, which is well below the threshold needed for an equalized housing market.
Right now, sellers have a clear upper hand due to limited listings, and buyers are paying the price. In December, the median price of an existing home sold was $309,800. That is a 12.9% climb from a year prior, and the highest median price for December on record.
The fact that homes are flying off the market is not helping buyers, either. In December, it took an average of just 21 to sell a listed property.
Should you buy a home in 2021?
Whether it pays to pay a home this year largely boils down to your financial circumstances and what you intend to do with that property.
If you are buying an income property, there’s huge demand for affordable rentals right now, so it could be worth paying a premium to add units to your portfolio. Similarly, house-flipping profits recently reached a 20-year high, so now’s a good time to get in on that game.
If you are thinking of buying a home to live in, not necessarily as an investment, then you will need to consider your financial situation. Right now, you will pay more for a home than normal, so you will need the cash reserves to support a higher down payment. You may also need to settle for a home that does not check off every box on your wish list given the limited number of properties that are available for sale in Al Rehman Garden Phase 7.
Buying a home this year is a mixed bag, whether you are an investor or are looking to put a roof over your head. While you might pay more for a home in 2021, you might also score a lower interest rate on a mortgage than you normally would. Assess your own finances and goals to see if buying is right for you, and if you are going to buy a property to hold onto (not flip), make sure you are an optimal mortgage candidate. The primary upside to buying this year is snagging a discounted home loan rate, so be certain you are able to get one.
Overall, it is Good Investment to Is Buying A Home in Al Rehman Garden Phase 7.