Be prepared for a tough time buying a home this year especially if you are first-time home buyer
With rising prices and mortgage rates, buying a home is going to be a real challenge. Home prices in Greenville SC in February have risen 5.43% from last year, according to Greenville SC MLS. We have seen many instances of sellers receiving multiple offers, including cash buyers bidding significantly over Greenville real estate listings.
Here are a number of factors why buying a home is more difficult this year especially for first time home buyers:
Home Prices are increasing
The average house price in the U.S. has increased about 25 percent in the last four years. Home prices are also increasing in South Carolina, including here in Greenville County. Residential home prices have increased 5.43% this year compared to last year.
The demand is high
It’s a seller’s market in many places across the country, in which there are more people looking to buy a home than selling a home. In a hot market like Greenville, sellers can expect a bidding war on a home if it was priced correctly.
Interest rates are rising
Mortgage rates have risen to 4.14%, according to Freddie Mac as opposed to 3.5% in November 2016. The current rate is not exactly high if we are looking at historical standards, but the increase is enough to make it tougher to get approved for a new mortgage. This interest rate increase is enough of a problem for first-time home buyers who are already struggling to find affordable homes.
In many states across the U.S., the inventory of homes has been low. It is especially hard to find lower-priced homes. Entry-level homes that come out on the market are easily snapped up. The lack of homes on the market is driving the home prices up and making it harder for first-time home buyers to buy homes. Even here in Greenville where seller traffic is moderate, it is becoming more common for houses to be snapped up a few days or even hours after homes have been put on the market.
In a Nut Shell
Tight inventory, increasing home prices, and mortgage rates will make home buying this spring a real challenge for first-time home buyers. This market condition definitely favors the sellers. Anyone trying to sell their home in Greenville will definitely sell quickly especially if priced correctly. If you are a first-time home buyer and you are looking to buy a home this spring or sometime this year, once you found a house that met all of your extensive criteria, put an offer in right away.