Things You Need To Know About Buying a Home In 2017
For any American, it is a dream to buy a house. Both dedication and commitment are required to achieve the goal. Certain changes can be noticed within the real estate market at every given circumstances. Therefore, homebuyers must be aware about situations in the market prior to purchase of a home. Following things must be given importance in case you have been trying to buy a home in the year 2017.
Increase in the mortgage rates
Before purchasing a home, you must know how much you can spend on a home. Due to lower mortgage rates, it has become possible to buy a house at affordable rates. However, it is also true that mortgage rates may not go lower than this. Therefore, an increase in the mortgage rates can be seen here on. In last quarter of 2016, drastic enhancement of mortgage rates has been noticed.
If the mortgage rates are at 4.25% even then a home can be acquired for an affordable price. Through home financing, homeowners are benefitted without any doubt. Rates are still lower in comparison to the previous 50 years. Due to rise in the mortgage rates, homeowner may have to look for less expensive homes. Monthly payments can be given in the process. Further climb of mortgage rates in future can be noticed also.
Millennials may look to buy homes
Policymakers are quite upset to observe the fact the millennials have not been purchasing homes as expected. However, a change may be seen in the coming year. If millennials start to purchase homes then it is possible to see an alteration in the prices of entry level for the first time buyers especially.
For the millennial, it may not be easy to buy a condominium or small houses. They may struggle with students loan till now. Student loans may take away all their savings and not much may be left to buy a house on the occasion. Therefore, savings cannot be utilized for the purpose of a down payment. Due to above reasons, millennials have been skipping the idea of purchasing homes unlike previous generations. In case the trend does not change then imbalance in the prices of home can be observed.
Influence of tax law
Financial benefits can be gained due to initiatives of tax reforms in 2017. President Trump is expected to change to tax system completely. Some of these reforms may affect the homeowners to some extent also.
President Trump is trying to increase the standard deduction amount dramatically. However, tax breaks like deductible on mortgage, taxes of real estate, deductions of high standard may be retained with little bit of cuts. In case your tax deduction is not enough for obtaining the benefits then homeowners may be at a loss. From the Republican side, some other changes have been proposed at the same time. As a result, tax deductions can be eliminated completely.
On most occasions, tax may not be considered as a deciding factor during purchase of a home. However, tax certainly creates an influence over the financial condition of the homeowner.