Investing in real estate might sound scary considering recent history. But recent news shows us that many people are putting their money in real estate!
Time is one of our most precious resources…
Time is money…
As the old saying goes, money doesn’t grow on trees. So in a world full of uncertainty, investing in real estate might sound scary.
Or even stupid given the past several years. But consider this:
45% of Sales in August 2013 Were Cash Deals
At least that is according to the latest data from RealtyTrac. They reported in their August 2013 US Residential & Foreclosure Report that the number of buyers using all cash is up from 39% in July. And last August, the number of people buying homes with all cash was 30%.
30% is high, but 45% is REALLY high.
The key thing to me is that so many people are looking to put their money into real estate instead of other places such as the stock market.
More Juicy Tidbits From RealtyTrac
- US home sales are up 12% from this time last year
- The US median home price is up 6% compared to this time last year
- This is the 17th consecutive month that the US median home price has increased
- US home prices are still 26% Below their peak back in 2006
Home prices are increasing but they are still well below what they were just a few years ago. And in real estate, you make your money when you buy, not when you sell. So if home prices are increasing, it could be an ideal time for buying a home.
Maybe you are thinking that investing in real estate is impossible for you. When you buy a home, it isn’t just a home. It is an investment in your future! However, real estate is a long term investment and NOT a get rich quick investment.
When you invest long-term, you are building your financial independence. And it really won’t take that much money in the bank to buy a home. Often you can buy a home with as little as 3.5% down. If you use a USDA Home loan there are ways to buy a home with much less cash out of your pocket!
3 Quick Home Buying Tips
- Start saving money NOW.
- You need good credit so you can get the best mortgage rate.
- Use websites such as this to learn more about buying real estate.
Think Long Term
Like I said, buying a house is a long term investment. As we saw after the housing bubble burst, home prices can go down. But Trulia just reported that housing is 67% back to normal:
- Construction starts are 40% back to normal
- Existing home sales are 99% recovered
- Foreclosures and delinquent mortgages are 60% back to normal
If you factor in that mortgage rates are still super low and have actually dropped since last week’s surprise announcement from the Fed, then you see that there is a great opportunity today.
They Took the Hint
I can hear the critics saying that I am just saying this since I am a REALTOR. So instead of taking my word for it, consider this:
New Home Sales Up
The Census Bureau announced today that sales of new single family homes in August 2013 were up 7.9% from July 2013 and up 12.6% from August 2012. The increase from July isn’t that impressive since home sales slowed down due to the spike in mortgage rates after the Fed hinted about tapering quantitative easing.
But that increase compared to August 2012 is impressive. I take this to mean that more people are seeing that NOW is a good time to buy a home. You can draw your own conclusions…
Pending Home Sales Up YOY
NAR also had a report today that might interest you regarding Pending Home Sales. This report refers to the number of homes under contract and not the number of homes that have actually closed. Anyway they said:
- Pending Home Sales in August 2013 are down 1.6% from July 2013
- Pending Home Sales in August 2013 are up 5.8% from August 2013
I think the decrease in Pending Home Sales for August 2013 from the previous month is due to the spike in mortgage rates spooking some buyers. Sad since even after mortgage rates went up, they were still historically low.
The YOY increase indicates to me that more people are seeing that NOW is a good time to buy a home.
The Take Away:
Cash sales are way up. I take this to mean that many people think putting their money into real estate is their best option. More people are seeing real estate as a secure place to invest their money. If you are buying a home to live in, it is still an investment…
An investment in your future.
Sales of both Existing and New homes are up compared to the same time last year. This says to me that more people see that buying a home today is a great investment in their future.
Even if you don’t have the cash to buy a home out right, mortgage rates are still super low. Home prices are still attractive.
Is It Time to Invest In Your Future?