Should I Wait to Buy a House In Prince William County, VA?
Should I wait to buy a house? Will prices go down? Will the economy weaken? Will interest rates stay this low?
These are all good questions to ask yourself if you are in the market to buy a new house. However, if you asked yourself these questions about a year ago (June 2012), the answer to all them would have been "no" — at least as the market has proven in Prince William County, Virginia.
The data is out and over the past year the Average Sales Price for a home (attached and detached combined) in Prince William County rose 9.87%. In June of 2012 the Average Sales Price was $320,868. In June of 2013 it was $352,542. That's significant.
The interest rates have also increased, now at 4.5 percent and rising.
What does these mean to you, the buyer? I created a chart to illustrate exactly what this means to you — showing the bottom line.
This graph shows a year-to-year comparison of the same house with an increase in value and an increase in interest rate and what the mortgage payment would be assuming a 20% downpayment. (It includes a 1.25% property tax and .5% PMI.)
Based on Prince William County, VA Average Sales Price 2012 to 2013:
The difference is $291.00 per month—that's $291.00 you could have saved if you bought the same house at this time last year. It's a car payment.
Of course this data is general and home values vary from home to home and location to location. But overall, this presents a good comparison of how a changing market can affect a mortgage.
There are also different circumstances for every individual and buying last year simply may not have been feasible for you. Or, the right house wasn't out there. Or, you are just starting your search now.
What does this mean moving forward? Right now, most analysts predict a continued steady growth in the housing market as well as the economy. Sure, the interest rates are rising but let's look at the history of interest rates over the last 30 years.
In the past 30 years, from 1971 to 2013 the highest average mortgage rate on a 30-Year Fixed was in October, 1981 at 18.45% (yikes!) and the lowest was October, 2012 at 3.31%. So, based on history, 4.5 is still pretty low.
So, should you wait to buy a house? I would say not.
Source: Mortgage-X.com & RBI Real Estate Market Statistics.
Bryan Garcia specializes in helping folks buy and sell real estate in Northern Virginia. His area of expertise is Prince William County — Haymarket, Gainesville, Bristow, Manassas, Warrenton and surrounding communities.
Call Bryan today (703) 753-9100, ext. 103 or email BryanGarcia@exitheritage.com anytime.
Get connected with Bryan to get connected with the Real Estate Market.