It’s Still a Great Time to Buy in Minneapolis
Inflation is high and interest rates are up—is this really the time to buy a house? Experts say, yes. Here are three reasons why buying a house right makes good sense.
Homeownership is a great hedge against inflation
It seems like prices are going up just about everywhere, but if you’re locked into a stable rate for the duration of your loan, your house payment will always stay the same. Unlike renting which typically renews (and often rises) annually, owning a home allows you to stabilize what is most likely your largest monthly payment.
There is less competition for houses
Unlike the craziness of the pandemic days when hot markets saw dozens of bidders frantically hoping to beat the competition, the market has slowed down, cooled off, and reached a less frenzied pace. Buyers have more time to make thoughtful decisions, get thorough inspections, and make smart housing choices that aren’t rooted in panic buying. According to Joe Grunnet, owner of DRG, fewer homes are closing over asking price.
“We’ve definitely seen a slow-down in the past few months from the peak of the sellers’ market when buyers were paying way over asking price and waving contingencies. It’s a much more reasonably paced market today. In fact, more people are moving into Minneapolis now than in the last six years.”
There are creative options for high-interest-rate lending
Mortgage lenders are a great resource when buyers are overwhelmed with an ever-changing market. A 2-1 Buydown is an option for homebuyers who want to afford a more expensive home even at higher interest rates. This lending technique gives you a lower mortgage payment during the first two years of the loan term—the first year is 2% below note rate, the second year is 1% below, and the third year is based on the actual interest rate of the loan. The buydown cost can also be split between different parties in the transaction. It’s especially good for first-time buyers who are anticipating their income to rise by year three of the loan as they ease into the final fixed rate.
If you’re ready to test the waters and explore your options for a buying a home, reach out!
To schedule a meeting with Joe Grunnet, click here.
DRG Owner/Urban Realtor