Good to be a Home Seller (and a Home Buyer)

Sellers still rule the housing market but they’ve lost much of the power they had two years ago. For VALoanMN clients and future clients this is actually good news. You may be thinking “how could a sellers market be good for me as a buyer?”. Here’s the truth about the real estate market: sellers’ markets are known as winners markets because everyone wins. If you’re considering the purchase of a home consider this; buyers prefer not to buy in a buyers’ market.

Generally speaking, in a buyers’ market home prices are going down. Buyers are shy about investing in a home if they believe in a few months or a year from now their house will be worth less than what they paid for it. However, in a sellers’ market home prices tend to increase thus making a purchase more attractive given the price you pay now will be less than the value in the future. Your home may seem like a good investment. So what does this mean to veterans considering the purchase of a home with a loan from VALoansMN? 

Interest rates are about double from what they were 2 years ago so it is more expensive to borrow. But if the value of the home is increasing the cost of your mortgager may be offset. In a previous post we quoted VALoansMN’s Brad Christensen saying “you date the mortgage, you marry the house”. For clarification of that phrase call Brad 612-240-9922 so he can explain the benefit of that way of thinking.

 Some economists say interest rates may decline due to a coming recession. History shows rates always go down in such an economic downturn. But what if they don’t? What if rates climb further as they did in the late 1980’s. In that period a VA loan rate of around 7% would have been an unreachable goal as rates were well into the teens. Get your VA Loan today and if rates decline in the future call VALoansMN and get a low-cost refinance to the lower rate. If rates continue to climb you’ll be considered a financial whiz for taking out a loan when rates were only 7% (or thereabouts).