Buy a Home This Fall


Real Estate Education for Home Buyers:  What the Fall will Bringbest-hingham-real-estate-agents

If you are looking to buy or sell a home in Hingham, Cohasset, Hull or any South Shore town so that you can experience South Shore living in one of our stunning coastal towns, a top Hingham Realtor, Alice Pierce of Coldwell Banker has some information to help inform you along the way.

Giver her a call anytime, night or day, or send Alice an email.

In order to make an informed decision when purchasing real estate, it is always a good idea to get your finger on the market pulse. Currently, the year has been very strong with a surge in new construction single family home sales that reached their highest levels since the fall of 2007. Existing residential homes tapered a bit nationwide in July, but still showed their strongest growth in sales in over 9 years.

Fall is typically known as the time of year when housing activity starts to slow down. With the onset of school activities, most families choose to preserve their location stability and not move into a new home.

There are things that factor into preserving a strong real estate market, but at the same time there are no guarantees.

One major part of any strong real estate market is how expensive it is to borrow money for purchasing homes. Currently, the wave of low mortgage interest rates keep the market open, giving home buyers like you an expanded range of purchase options. Psychologically, these low interest rates create and then bolster buying and selling momentum because of the belief in the inevitable upwards creep in rates. Right now, the monthly average commitment rate and points on a 30 year fixed-rate mortgage decreased to 3.44% and .5 points in July 2016 as compared to 4.05% and .6 points in July 2015.

Another ingredient in this robust real estate market is our nation’s economy. Continued job growth means there are more and more home buyers stepping into the real estate market for the first time. According to the U.S. Bureau of Labor Statistics, the United States added 255,000 jobs in July of 2016, whereas July of 2015 saw an additional 215,000 jobs. A caveat is that historically, when the economy shows stable improvement, rates tent to slowly rise.

The number of brand new home buyers who now own their first homes has indeed increased. The National Association of Realtors reports that June home sales this year consisted of 33% first-time home buyers, and that in July of 2016 the percentage of first time buyers was at 32%. This percentage represents an increase of 28% from the same time last year. When looking at annual data overall, last year first-time buyers represented 30% of all home sales, and so far in 2016 they represent 31% of all buyers.

Like every other cycle, the real estate market is circular and reactive to all its parts. The rental market is another thing that factors into our strong real estate market. Increased rental prices have been driven up by the supply and demand and those of you paying premium rents are now rethinking where your money is going. Recent data from Harvard University’s Joint Center for Housing Studies and Enterprise Community Partners tells us that renters spending over half of their income on rent is on the rise.

Most often, if one has decent credit, some savings and a fairly good income, paying $2,000 a month in rent can translate into enough mortgage to purchase some real estate. In order for the rental vs. home buying field to become equal, the interest rates need to be around 6.5%. If this happens, the cost to rent and buy the same property would be approximately the same every month.

One of the catches here is that a strong market generally means strong median home prices. This creates some limitations on existing inventory and new construction, and sometimes the only way to purchase the home you want is to move much faster than you might anticipate.

To this end, it truly does pay to have a Realtor who knows his or her communities inside and out. It is not helpful to take your time looking at homes and learning abut different communities and neighborhoods along with the real estate agent when time is of the essence. When you choose a Realtor wisely, this person will ask the right questions to quickly understand what it is you want in both your home and community. And if you pick a Realtor with deep roots in their community, you can avoid wading through tons of listings and neighborhoods that are not the right fit.

Although there is great pressure on home buyers to buy now, mostly because of the still quite compelling interest rates, it is a good idea to check in with yourself to make sure you are less reactive and more logical. Sticking to a price you can truly afford will affect your day to day living and ability to enjoy one of the South Shore’s waterfront towns.

Be sure to stop and analyze your desires and possible decisions. Look at the values of the homes your are attracted to and research pricing in relation to inventory and/or the strong economy. In other words, the limitations on new construction and existing home inventory in some areas gives buyers fewer options and there will be more buyers per listing than if the inventory was higher.

Some economists are projecting that because home prices are at all-time highs, homeowners are more likely to be prompted to sell now, rather than wait so they can get high value for their properties. The price appreciation is another motivating component to the real estate cycle.


The season leads to less inventory which leads to home appreciation.

Low interest rates and high rents lead to more first-time buyers which leads to more competition for homes.

The future unknowns of home prices and interest rates compel movement of buyers and sellers for an active real estate market.

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