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The Best Time to Buy When you consider buying a new home, keep this in mind: interest rates and the market prices for residential real estate tend to move in opposite directions. Some people mistakenly believe buying a home is a bad idea when prices are up or when interest rates are high, however, the facts tell a very different story. In truth both of those situations can create some exceptionally good buying opportunities. Knowledge, in real estate, is everything.
If you look at historical data charts you will see that high interest rates actually dampen the demand for homes. With fewer buyers available, sellers can't raise their prices - in fact, they may have to drop asking prices to get their homes sold. That's a good opportunity for buyers, who can always refinance their mortgages when interest rates drop, as they eventually will.
On the other hand, low interest rates bring buyers into the market, bidding up residential property prices. This is because lower interest rates make those higher prices more affordable.
Long-term capital growth is a most important consideration. Why? Because when you buy a house you also buy an investment and the principle aim of any investment is capital growth.
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