03/25/2020: What to Know Before Buying a House in 2020
In our last blog, we gave an overview of a few of the home loans that we provide here at Citizens Bank. This overview included everything from basic Conventional fixed-rate loans and adjustable-rate mortgages to more specified mortgages such as FHA, VA, and portfolio loans Understanding and choosing the right mortgage plan are the first steps toward homeownership.
Though the task can seem daunting, we’re here to guide you along every step of the way.
Buying a home in our current economy
Today, we’d like to talk about the current environment for buying a home and how Citizens Bank can help you navigate this housing market. The housing market is akin to the economy at large: the outlook for buying a home is highly dependent on current conditions.
Overall, there’s never been a better time to buy a home. Still, there are several factors to take into consideration to be sure that you’re buying the right house, with the right mortgage.
Current Mortgage Rates
Current mortgage rates apply to people buying homes now, or to those with adjustable-rate mortgages whose fixed-payment period is coming to a close (remember: unlike conventional fixed-rate mortgages and FHA loans, adjustable-rate payments fluctuate in tandem with the prevailing mortgage rates.)
It is important to really understand current mortgage rates because they determine how much interest will be added to the monthly payments on your home loan. Mortgage rates are dependent on many factors. At Citizens Bank, we take into consideration your credit score and financial circumstance to choose the right mortgage for you.
However, your scores, income, and the type of mortgage you choose aren’t the only factors that determine your mortgage rates. Citizens Bank also considers the current state of the housing market, the overall economy, and the prevailing interest rate, which helps guide banks on lending practices.
You might be asking how you’re supposed to calculate all these factors! Just remember that Citizens Bank is one of the most experienced mortgage lenders in the country. In addition to online tools, our mortgage experts act as barometers for the entire housing market, and you can rest assured that we’ll provide you with the best options that match the most up-to-date information to your individual needs.
Housing Prices and Supply Will Moderate
According to our indicators here at Citizens Bank, today’s housing supply is relatively low. This means that the number of affordable homes for sale will remain lower than normal. These conditions are due to factors such as high demand for houses and an older generation–Baby Boomers–that is content to remain in their existing homes.
Construction never stops, and at some point supply will catch up and prices will drop again, following the pattern that has prevailed ever since the housing market was born.
Buying a House in 2020
We hope that this can help get you started on understanding what to consider when buying a home this year.
At Citizens Bank, our home loan experts are dedicated to helping fit you into the house of your dreams. Please feel free to visit the Ask Joan page as an offshoot of the Citizens Bank website, where you can find all the information you need and more about buying a home in 2020.