“Here’s a look at how just the home price appreciation piece can really add up over the years.”
If you’re thinking about buying a home soon, higher mortgage rates, rising home prices, and ongoing affordability concerns may make you wonder if it still makes sense to buy a home right now. While those market factors are important, there’s more to consider. You should think about the long-term benefits of homeownership too.
Think about this: if you know people who bought a home 5, 10, or even 30 years ago, you’re probably going to have a hard time finding someone who regrets their decision. Why is that? The reason is tied to how home values grow with time and how, by extension, that grows your own wealth. That may be why, in a recent Fannie Mae survey, 76% of respondents say they believe buying a home is a safe investment.
Here’s a look at how just the home price appreciation piece can really add up over the years.
Home Price Growth over Time
The map below uses data from the Federal Housing Finance Agency (FHFA) to show just how noteworthy price gains have been over the last five years. And, since home prices vary by area, the map is broken out regionally to help convey larger market trends:
If you look at the percent change in home prices, you can see home prices grew on average by just over 57% nationwide over a five-year period.
Some regions are slightly above or below that average, but overall, home prices gained solid ground in a short time. And if you expand that time frame even more, the benefit of homeownership and the drastic gains homeowners made over the years become even clearer (see map below):
The second map shows, nationwide, home prices appreciated by an average of over 297% over a roughly 30-year span.
This nationwide average tells you the typical homeowner who bought a house 30 years ago saw their home almost triple in value over that time. That’s a key factor in why so many homeowners who bought their homes years ago are still happy with their decision.
And while you may have heard talk throughout the year that home prices would crash, it hasn’t happened. In fact, experts project home prices will continue to rise for years to come.
Bottom Line
If you’re wondering if it still makes sense to buy a home today, it’s important to focus on the long-term advantages that come with homeownership. When you’re ready to start your homebuying journey, let’s chat.
To view original article, visit Keeping Current Matters.
In Today’s Market, Listing Prices Are Like an Auction’s Reserve Price
Today, the asking price is often becoming the floor of the negotiation rather than the ceiling.
Why You May Want To Cash in on Your Second Home
If you purchased a larger second home during the pandemic, will you continue to use it or should you sell and cash in?
Dreaming of a Bigger Home? Why Not Buy It This Year?
If you’ll be able to work remotely long-term or your overall needs have changed, it’s a great time to sell your house and move up.
What’s Motivating People To Move Right Now?
Having room to maintain a healthy lifestyle at home – physically and mentally – may prompt you to consider a new place to live.
6 Reasons to Celebrate National Homeownership Month
If you own your home, take time this June to celebrate the ways homeownership has added value to your life!
How Misunderstandings about Affordability Could Cost You
Homeownership is the first rung on the ladder of financial success for most households, as their home is most often their largest asset.