Right now is perhaps the closest thing to the perfect time to build a new home we will ever see. If you have been holding off breaking ground on your new home, it may be time to reconsider your position. Here are the top 5 reasons why we think now is the time to build:
1. Mortgage rates dropped to a near record low, even as recently as this week, but are expected to start moving up again soon. “Experts say it’s time to get a loan now, or end up with a higher rate later…Mortgage professionals believe rates are poised to jump sharply within a few weeks.” (source: http://www.bankrate.com/finance/mortgages/mortgage-rates-drop-to-2010-low.aspx).
2. Home prices continue to fall, but not as drastically. According to CNNMoney.com, while home prices have fallen another 2.5% during the last 3 months of 2009, that was a “big improvement over the past three years.” This means that the trend down may be about to change, and housing prices may be about to start trending up instead of down. (source: http://money.cnn.com/2010/02/23/real_estate/2009_Case-Shiller_report/index.htm)
3. The price of materials will inevitably start to go up as building resumes. CNNMoney.com reports that “Home Depot said it returned to a profit in its fiscal fourth quarter after posting a loss a year earlier, with earnings of 18 cents per share, two cents better than expected.” (source: http://money.cnn.com/2010/02/23/markets/markets_newyork/index.htm)
4. Land prices are at an all-time low. While this is, of course, specific to your region of the country, in Austin, TX, the general belief is that these prices are only going up from here. “January 2009 was the low point of this cycle…with steady improvement throughout 2009 that continued in January 2010, we can see that we’re one year into the recovery in Austin.” (source: http://www.bizjournals.com/austin/stories/2010/02/15/daily52.html?ana=from_rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+bizj_austin+%28Austin+Business+Journal%29)
5. Tax credits have been extended. “The Worker, Homeownership, and Business Assistance Act of 2009 has extended the tax credit of up to $8,000 for qualified first-time home buyers purchasing a principal residence. It also authorized a tax credit of up to $6,500 for qualified repeat home buyers.” (source:http://www.federalhousingtaxcredit.com/)