Are There Normal Market Conditions for Buying a Home?

Have you ever wondered what a “normal” market looks like? It wouldn’t be surprising given that headlines tend to go from exclaiming, “historically low!” to “incredibly high!” No one ever reports on the housing market being “fine.” So how’s a buyer to know? In this article, we explore the idea that the answer to this question may not necessarily require market data. In fact, it’s not so much about normal market conditions as it is about your unique scenario. 

What Makes It “Normal?” 

Put home prices and interest rates to the side for a second. (Don’t worry, we’ll come back to them later). Beyond the headline, there is a full story to be told that involves personal circumstances, buying tactics, and mortgage solutions. 

• Circumstances – Do you plan on living in the same area for 2-5 years or more? Are you in a position to use your assets to start building wealth in the form of equity? If the answers are yes, all signs point to homebuying being a sound decision. 
• Search & Offers – Keep in mind that your real estate agent has seen it all. Houses are bought and sold in any market and they have the search and negotiation tactics to make you jump up and down with joy during the homebuying process, no matter the environment.
• Solutions – We as mortgage bankers at United Home Loans have access to a seemingly unlimited pool of tools and resources. We can help buyers cover costs and lower their interest rates when it makes the most sense for them. 

Ultimately, the market doesn’t have to dictate “normal.” Everyone’s buying situation is entirely unique, so it comes back to how their agent and mortgage banker help them navigate the smartest financial decision.

The Market vs. The Result  

Consider this… When home prices are low, a borrower may comfortably choose to put 5% down and use a seller credit for something like minor repairs. When home prices are higher, the same borrower could instead put 3% down and use programs or credits to cover upfront costs, making the purchase just as comfortable. The same kind of example can be said about interest rates- for example, putting a credit toward a lower rate. In either scenario, the decision to buy a home is perfectly logical. As you can see, no matter the market, the goal achieved is the same. 

“Normal” is Unique

Every market presents its challenges and some have a bigger impact on feasibility than others. That said, waiting for more normal market conditions to trend is not always the best option. According to your unique circumstances, such as the results of a rent vs. buy analysis, the level of equity in your existing home, and the mortgage programs and tools you may qualify for, buying now rather than later might be the “normal” decision. If you’re wondering if this is the right time to buy or refinance, the first thing to do is to talk to a mortgage banker.