As we enter the summer months of 2022, you may be questioning if it’s a good time to purchase a home. You’re not the only one. Between world events, inflation, and rising rates many people are questioning what it all means for them and their home buying goals. However, when considering your options it’s important to remember that buying a home is still a good investment that can help save you money in the long run.
What the Polls are Saying
Currently, an average of 30% of Americans think that it’s a good time to buy a home. That average from Gallup’s annual Economy and Personal Finance poll is lower than the previous year’s average. Those results are driven in large part by the uncertainty many Americans feel regarding the market. Even in uncertain times, Americans say buying a home is the best long-term investment.
Americans Say Buying a Home is Still a Good Investment
Gallup also polls Americans on what they consider to be the best long-term investment between real estate, stocks, gold, savings accounts, and bonds. Real Estate has remained the top contender for the best long-term investment since 2013. This year, 45% of Americans believe that buying a home is the best investment, up from 40% last year.
Benefits of Homeownership
Buying a home is the best investment for several reasons.
- Buying a home can lock in the cost of living. Those who watch mortgage rates notice that they tick up or go down based on economic factors. Locking in a rate while they’re still relatively low can help alleviate that uncertainty and help you lock in your cost of living.
- Homes generally increase in value over time. As the demand for housing increases, the value of homes increases as well. That coupled with the home’s location and any additions you add to your home, keep real estate the best investment.
- Purchasing a home helps you avoid rising rent. Inflation often causes rent prices to spike. In uncertain economic times, many people find themselves worried if they can pay the rising cost of the rent. By purchasing a home and locking in your rate, you remove the uncertainty of the effect of inflation on rent prices.
- Homeownership allows the freedom to modify your home. Many renters know the frustration of renting and following the landlords guidelines. Owning your own home allows homeowners the freedom to add additions and modifications to their home.
Evaluate Your Financial Situation When Buying a Home
At the end of the day, Americans need to consider their financial situation to determine if it’s the right time to purchase a home or not. No amount of polls is going to determine that for you. Instead, consider the benefits of homeownership and your financial situation. Look at things like:
- Can you afford the rent to go up or does it make more sense to lock in your rate by purchasing a home?
- Do you have money for a security deposit to rent a home? Would it make more sense to put that towards a down payment on a home or take advantage of mortgage programs like MSHDA which have down payment assistance?
- Will renting a larger home cost you more down the line and make future investments more difficult?
Buying a home is still a good investment, even amid uncertainty. Evaluating your financial situation and speaking with a trusted lender can provide more certainty by locking in your cost of living.
About MSHDA Approved Lender, Julie Krumholz
Julie Krumholz has over 30 years of experience in helping Michigan homebuyers navigate the mortgage industry. With experience in a variety of mortgage products including MSHDA DPA loans and VA loans, Julie brings a wealth of knowledge to first-time homebuyers with various financial situations.
If you’re looking for a lender in Michigan, call Julie from Superior National Bank today at 586-382-5482 to answer any questions and help you through the loan process.
