The Wall Street Journal recently published an article stating that now is the time to buy a house. The author of the article, Jack Hough, says there are two factors right now which suggest now is the time to buy. First, the nation’s ratio of house prices to yearly rents is nearly the same as before the housing bubble. Second, it is more affordable to buy a house now then it has been in decades. There are many factors that go into deciding whether it’s better to rent or own, but right now, it’s time to buy. Mortgage rates have never been lower, and that is a key determinant of a buyers total costs. The latest mortgage rate is less than half the average since 1971. These low rates cause house payments to be much more affordable than they have been in the past.
According to Zillow.com a median priced home could cost around $121,700. If a buyer puts down 20% and gets a 4.12% mortgage rate, they would only be paying $470 a month. If the buyer chose to rent that same home instead, they would be paying $1,100 a month in rent.
And don’t think that just because mortgage rates are so low that it is extremely hard to get a great rate. As long as you have good credit, a job and a down payment, a low rate is achievable. It isn’t always the best time to buy, but when prices are low and loans are cheap, there is no better time!
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