“Roller Coaster Real Estate Is Normal”
By Robin Miller
Buying a home won’t get much cheaper…Is the headline in a recent article from CNN money. See link at bottom to view the original article.
Based on this type of real estate information appearing online recently, it is apparent that the U.S. is seeing more leveling out of home prices. This has been very similar in the Mexico real estate market. For instance in resort and ex pat areas, second homes have also seen a large drop in pricing. For a home to sell, or at least get viewed, the listing price should fit the market. If it is priced too high, the chances are it won’t get noticed, unless of course it is an extremely unique, one of a kind type property. When the property is listed at a price that fits in line with the current market, it has a better opportunity. It must also “compete” with other properties, because there is an abundance of inventory. Once the lower priced listings are sold, you would see on the MLS (Multiple Listing Service) that the lower priced properties are not as readily available; therefore it “looks” like the prices have been raised.
This is an indicator that it is a good time to purchase a second home in Puerto Vallarta for instance. I have always heard that when the U.S. gets a cold, we, in the Mexico resort real estate industry, get pneumonia! As we see reports from the U.S. on prices dropping, homes selling, prices increasing, mortgages more available etc., we know our Mexico real estate market is close behind the trend. There have always been highs and lows in the real estate market regardless of what country. That’s part of the industry.
There are other reports in this CNN Money article that pose the question “Is home buying much cheaper than renting?” Their answer is “It’s the eternal question in real estate: Should I buy or rent?” The answer has never been clearer: Buy.
The article goes on to say that in several areas in the U.S., There are several reasons. Home prices are falling. Mortgage interest rates are at historically low levels. And rents are on the rise.
It continues on to say “In some markets hit hard by foreclosures, the turnaround in prices is already underway. Phoenix recorded an 8.4% jump in home prices during the three months ended April 30, compared with the three months ended January 31, according to Clear Capital.”
“It’s crazy,” said Tanya Marchiol, founder of Team Investments, a Phoenix real estate investing firm. “Stuff I was selling six months ago for $60,000 to $80,000 is now $90,000 to $110,000”.
Further along they state that Home prices hit new post-bubble lows in February, according to a report out Tuesday, and Zillow quotes “Prices for bottom-tier properties have improved since 2011, reports Zillow, while top-tier prices keep falling.
Add to this, Money Magazine also states that Mortgage payments are at their lowest level in decades, and for today’s homebuyers, the weight of the monthly mortgage bill is the lightest it’s been in decades.
Based on this information, it really is clear that buying now is a better option. Especially in Puerto Vallarta Mexico!