Many often think they can “time” the real estate market, but as we know it is virtually impossible. With the current prevailing uncertainty, most buyers are nervous even when the signs show that it has hit or is near bottom. That said, waiting that out may result in a missed opportunity. We think it is an excellent time to purchase a home for the following reasons:
- Fear & Uncertainty Create Opportunity
Most savvy investors will say that when everyone is negative on the market, it is often a good time to buy.
- Mortgage Interest Rates
While already historically low, mortgage interest rates have been further reduced to near record levels.
- Higher Negotiability
Price reductions and sales below their original asking price have become commonplace these days as sellers are still facing the realities of the softened market. Properties that are not priced properly linger and eventually become stale, this creates the impression that there is something wrong with the property or that it is overpriced. Stale properties can represent a great opportunity for a savvy buyer.
- Buyer Incentives
Many new developments are offering buyer incentives whether it’s a break on closing costs or no-cost for a building amenity such as storage or parking.
- Increasing Inventory
As we stated earlier, inventory has been on the rise for the past two years hitting a high in this year’s second quarter. This provides a buyer with a larger selection of properties with less competition.
- Investment Timeline
If you are planning to own a home for 7 to 10 years, you are likely to see a higher rate of return upon sale than in other investments.
- Decreased Competition
The spring market (February – June) is historically the most active period of the year as buyers generally search for a home to buy so they can close in the summer months. In the autumn, between settling into the new season and a new school year as well as major religious/secular holidays, there is less time for the market to heat up. In addition, fewer buyers are focused on purchasing a home during this period which translates to less competition and greater opportunities for good deals.
- Buying and Selling Concurrently
Buying and selling under the same market conditions can be advantageous as the reduced prices on the buy side often make up for the lower sale side. There are some exceptions to this as certain market segments are stronger than others.
- Properties with Flaws
In NYC, everything has a price but in a strong market, buyers will overlook certain flaws to acquire some other features they want. In a weak market, or one that favors buyers with a large inventory, it is harder to overlook less desirable features, and sellers will have to be realistic about value.