You’re at the end of your last apartment lease and now you’re ready to buy. Now it's just a matter of financing and finding an affordable rate to work with over the next 30 years. Well let me shed some light on the matter. If your migrating from a lease to a mortgage, now is the time to get your ducks in a row. Interest rates have been flocculating between 3.40-4.29% during the last few years. However in most recent stats, the market has taken a seat in the 3.39% arena. For how long is the question of the day. If you haven’t done so already, now’s the time to get locked in at this low rate and close the deal. No time for procrastination. And here’s why. I did a little research within the Wenatchee valley on what the average costs for renting an apartment would be, compared to an average mortgage payment. In the years since the recession, the economy has been steadily adding jobs across the country. However, construction of new housing has continued to remain stagnant. I checked the U.S. Census data on building permits and Bureau of Labor Statistics data, to see how the supply of new housing has responded to the demand spurred by job growth. There is a strong correlation between the supply of new housing and rent growth, indicating that the lack of new construction is contributing to the affordability crisis in many parts of the country.
As America’s cities continue to grow and add jobs, it’s crucial that sufficient new housing is built to meet the demand created by that growth. Nationwide data found that only 10 of the nation’s 50 largest metros have produced enough new housing to keep pace with job growth in recent years. In many metros, job growth tends to be centered in the county containing the core city, while a greater share of housing units are being added to the surrounding suburbs, leading to heightened levels of undersupply in the core cities. In August alone, there has been a continuation of summer rent increases, with our national index up 0.4% month-over-month.
Fact of the matter is, apartments are being built faster than homes are. Leaving renters vulnerable just for a roof over their head. Property list pricing are at an all-time high and have been for the last five years. Why? Because we are running out of places to build. Property owners and builders are taking full advantage of this opportunity because well, they can. If you drive through development after development, you’ll see the exact same home one after another, just a different color. Less square footage and a backyard big enough for a lawn chair. Single-family homes priced under the$200k radar are not listed for very long as the average cost of a 3 bed/2 bath, now run an average of about $250k. Problem is, there aren’t enough single-family homes to go around. So please take my advice. If you’re seriously looking to make the jump into a mortgage, get pre-approved and do a lot of driving. Sometimes what you’re looking for may not even be listed. Make sure you drive up and down every street and cover every block. You may just stumble upon the home you’ve always wanted.