Is Now the Best Time to Buy a Home?
As a luxury custom home builder in the Richmond, Virginia real estate market, we have had the pleasure of working with buyers who have been dreaming of their perfect home. However, we often see buyers grappling with conflicting emotions, such as the financial impact, overall costs, and affordability of their dream home. It can be overwhelming. With speculation about the rise and fall of interest rates, as well as economic uncertainty, many buyers are left wondering whether they should wait or take the leap.
One common mistake we have observed among buyers is the belief that home prices might drop. In fact, we have worked with buyers who have been patiently waiting for prices and interest rates to decline since early 2022.
The reality is that prices on new construction homes are not going down. National data from reputable sources consistently indicate the opposite. For instance, Fannie Mae Researchers project an overall price increase of 6.7% in 2023 and 2.8% in 2024. Similarly, the Mortgage Bankers Association expects a 5.7% increase in 2023 and a 4.1% increase in 2024.
According to CoreLogic’s Home Price Index, home prices nationwide rose by 0.3% from August to September 2023, hitting a new all-time high for the fifth consecutive month. Based on this year’s monthly readings, CoreLogic’s index is on track for an 8% appreciation in 2023, with other indexes also indicating a 7% appreciation.
The ongoing rise in home prices can be attributed to the scarcity of available homes. There simply are not enough homes for sale to meet the demand of the buyers. As Freddie Mac states, “While rising interest rates have reduced affordability and therefore demand they have also reduced supply through the mortgage rate lock-in-effect. Overall, it appears the reduction in supply has outweighed the decrease in demand, thus house prices have started to increase…”
Whether you are buying a home for financial investment or looking for a place to call home, purchasing sooner rather than later presents an opportunity to start building equity now. There is no guarantee that home prices or interest rates will decline soon. So, if you do not want to put your plans on hold, waiting may not make sense.
Ultimately, if you are ready to turn your dream of owning a custom luxury home into reality, do not let concerns about interest rates or declining home costs deter you. Let’s connect and discuss your aspirations in more detail.
Contact John Fleming at 757-903-6730 or visit our website to explore our custom home floor plans in Richmond, VA. Our exceptional designs will help you embark on the journey of building your dream home with our custom home builder.
Ellington Custom Homes is an AR Homes ® custom home builder in Richmond, VA.
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