Family Wealth – The Connection With Home Prices | Scottsdale Real Estate – Luxury Valley Homes
Family Wealth – Over the next five years, home prices areexpectedto appreciate 3.22% per year on average and to grow by 17.3% cumulatively, according to Pulsenomics’ most recent Home Price Expectation Survey.
So, what does this mean for homeowners and their equity position?
As an example, let’s assume a young couple purchased and closed on a $250,000 home in January. If we look at only the projected increase in the price of that home, how much equity will they earn over the next 5 years?
Since the experts predict that home prices will increase by 4.4% this year alone, the young homeowners will have gained $11,000 in equity in just one year.
Over a five-year period, their equity will increase by nearly $43,000! This figure does not even take into account their monthly principal mortgage payments. In many cases, home equity is one of the largest portions of a family’s overall net worth.
Not only is homeownership something to be proud of, but it also offers you and your family the ability to build equity you can borrow against in the future. If you are ready and willing to buy, find out if you are able to today!
Mortgage Rates Impact on 2017 Home Values
There is no doubt that historically low mortgage interest rates were a major impetus to housing recovery over the last several years. However, many industry experts are showing concern about the possible effect that the rising rates will have moving forward.
TheMortgage Bankers Association, Fannie Mae, Freddie Macand theNational Association of Realtorsare all projecting that mortgage interest rates will move upward in 2017. Increasing interest rates willdefinitely impact purchasersand may stifle demand.
In a recent study of industry experts,“rising mortgage interest rates, and their impact on mortgage affordability”was named by 56% as the force they think will have the most significant impact on U.S. housing in 2017. If rising rates slow demand for housing, home values will be impacted.
To this point, Pulsenomics,recentlysurveyeda panel of over 100 economists, investment strategists, and housing market analysts, asking the question“In your opinion, at what level will the 30-year fixed rate mortgage rate significantly slow home value appreciation?”The survey revealed the following:
Most experts believe that rates would need to hit 5% or above to have an impact on home prices.
Article: Family Wealth
Jeff Daleyis a decorated Vietnam Veteran that supports veterans and veteran issues when possible.
Jeff and Jane Daley started their careers in real estate after taking early retirement from the corporate world in October of 1999. Their success is achieved by way of their core values.
MILITARY SERVICE: Jeff is a Vietnam combat veteran and served in in the US Army. He served with distinction, and received multiple citations.