Getting your financing secured early in the process of buying a new home or property is VERY significant, even essential! Doing so will tell you what amount you will be able to borrow and establish
The Cost Of A Home Vs The Price Of That Home
The 'affordability of money' -that is, the cost of borrowing money to purchase a home- remains at historic lows due to current interest rates that over this year have decreased again.
For further explanation of the incredible value that factor offers to a homebuyer, enjoy this post below from my REALTOR® friends, Ann Cummings and Jim Lee, in Portsmouth, New Hampshire (our area's home prices are considerably lower, but the principle is just as applicable to south Louisiana home purchases) ...
Forget the Price of the Home. The Cost is What Matters.
“In January 2019, a family with the median household income in the U.S. could afford to buy a $373,900 house. By August, that home had appreciated to $395,000, an increase of $21,100.”
Mortgage Interest Rates
“The 0.85 percentage point drop in mortgage rates from January 2019 through August 2019 increased affordability by 9.7%. That translates to a $40,200 improvement in house-buying power in just eight months.”
“As rates have fallen in 2019, the economy has continued to perform well also, resulting in a tight labor market and wage growth. Wage growth pushes household incomes upward, which were 1.5% higher in August compared with January. The growth in household income increased consumer house-buying power by 1.5%, pushing house-buying power up an additional $5,600.”
“Focusing on nominal house price changes alone as an indication of changing affordability, or even the relationship between nominal house price growth and income growth, overlooks what matters more to potential buyers – surging house-buying power driven by the dynamic duo of mortgage rates and income growth. And, we all know from experience, you buy what you can afford to pay per month.”
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He or she works for a particular builder and would be obligated, if not contracted, to show you only the houses that builder has available or could build for your needs if you have the luxury