Throngs of people will visit Carlsbad and the coastal shores of San Diego this year, as they do every year. Warm weather and a picturesque lifestyle will cause many to imagine what purchasing a home would be like in our fabulous city. Parents consider selling before school is back in the fall, and the local real estate market bustles with activity. The summer selling season is here and many are asking the question, “Is now a good time to buy?”
Interest rates
It is not difficult to report on mortgage rates, as they remain relatively unchanged since the year began; around 6 percent. The federal reserve met in May and decided, for the seventh straight time, to keep the federal funds rate unchanged at 5.25 percent. Buyers in today's market must realize that these rates are excellent. The same time last year, mortgage rates were almost 1 percent higher at 6.85 percent.
Cost of a home
If you compare the current Carlsbad market to that of the past three years, it is a great time to buy a home, as many sellers are now open to negotiation. In the past, buyers had little choice or negotiating power when it came to buying a home. With multiple buyers lining up to purchase one property, sellers had the power to get exactly what they wanted. In today's market, buyers can negotiate a fair deal. Some homes are being sold 10 to 15 percent below the height of the 2004 market. Others have sold more than what they had in 2004. Buyers can now decide what a home is worth to them, as opposed to paying what they think they others would.
Inventory levels
Traditionally, the number of homes for sale starts to rise in March and continues slowly until it peaks near July. What is notable is that the trend of increasing inventory has not occurred at it usual pace. Currently, there are around 450 detached homes for sale in Carlsbad. The May inventory figures are seasonally low; a great sign for those selling homes. In the 2005, summer inventory levels rose to more than 700 homes actively being sold at the same time (not including new home construction). And when supply overwhelms demand, prices will soften. Note: select neighborhoods or home types could have an unusual amount of local competition, which will affect price and time-on-market.
Must do's for buying
Many will seize the opportunity and purchase a home. There are several must do's as a buyer in today's market.
Know what you can afford
Understanding how much home you can afford is the most important step in the buying process. There are a number of costs to home ownership that are overlooked by buyers in today's market. Online mortgage calculators will not often factor in property taxes (around 1 percent), any applicable mello-roos fees, homeowners association fees or insurance costs. There are also costs of yearly maintenance that should be factored into the equation that vary depending on the home you are interested in. A property in Olde Carlsbad built in the 70's, will most often have repairs (roof, plumbing, etc.) that a new home will not require. Understanding your price range will allow you to avoid the heartache of falling in love with a home, only to find it is too expensive. Your first step in purchasing a home is to get pre-qualified from a lender that you trust.
Explore your options
Shopping for a home is exciting. So exciting that it is not uncommon for one to purchase the first property they visit. With a majority of the home's pictures, information and history available online, it is easy to purchase without physically seeing many homes. Buying in this manner is not recommended. Physically viewing homes provides a basis for your opinion of value. It is recommended that you see things at and below your price range, but not above. Shopping for homes above your price range will create disappointment. A competent, experienced professional can assist in this process. As you understand value, you will negotiate better, buy with confidence and ultimately be happier with your purchase.
Interest rates
It is not difficult to report on mortgage rates, as they remain relatively unchanged since the year began; around 6 percent. The federal reserve met in May and decided, for the seventh straight time, to keep the federal funds rate unchanged at 5.25 percent. Buyers in today's market must realize that these rates are excellent. The same time last year, mortgage rates were almost 1 percent higher at 6.85 percent.
Cost of a home
If you compare the current Carlsbad market to that of the past three years, it is a great time to buy a home, as many sellers are now open to negotiation. In the past, buyers had little choice or negotiating power when it came to buying a home. With multiple buyers lining up to purchase one property, sellers had the power to get exactly what they wanted. In today's market, buyers can negotiate a fair deal. Some homes are being sold 10 to 15 percent below the height of the 2004 market. Others have sold more than what they had in 2004. Buyers can now decide what a home is worth to them, as opposed to paying what they think they others would.
Inventory levels
Traditionally, the number of homes for sale starts to rise in March and continues slowly until it peaks near July. What is notable is that the trend of increasing inventory has not occurred at it usual pace. Currently, there are around 450 detached homes for sale in Carlsbad. The May inventory figures are seasonally low; a great sign for those selling homes. In the 2005, summer inventory levels rose to more than 700 homes actively being sold at the same time (not including new home construction). And when supply overwhelms demand, prices will soften. Note: select neighborhoods or home types could have an unusual amount of local competition, which will affect price and time-on-market.
Must do's for buying
Many will seize the opportunity and purchase a home. There are several must do's as a buyer in today's market.
Know what you can afford
Understanding how much home you can afford is the most important step in the buying process. There are a number of costs to home ownership that are overlooked by buyers in today's market. Online mortgage calculators will not often factor in property taxes (around 1 percent), any applicable mello-roos fees, homeowners association fees or insurance costs. There are also costs of yearly maintenance that should be factored into the equation that vary depending on the home you are interested in. A property in Olde Carlsbad built in the 70's, will most often have repairs (roof, plumbing, etc.) that a new home will not require. Understanding your price range will allow you to avoid the heartache of falling in love with a home, only to find it is too expensive. Your first step in purchasing a home is to get pre-qualified from a lender that you trust.
Explore your options
Shopping for a home is exciting. So exciting that it is not uncommon for one to purchase the first property they visit. With a majority of the home's pictures, information and history available online, it is easy to purchase without physically seeing many homes. Buying in this manner is not recommended. Physically viewing homes provides a basis for your opinion of value. It is recommended that you see things at and below your price range, but not above. Shopping for homes above your price range will create disappointment. A competent, experienced professional can assist in this process. As you understand value, you will negotiate better, buy with confidence and ultimately be happier with your purchase.