The Limited Times

Now you can see non-English news...

Inflation is also affecting home prices. This is what you need to know if you want to buy one

2021-11-26T13:54:08.615Z


Median-priced home buyers are spending $ 160 more on a monthly mortgage payment than a year ago. This is what the experts recommend if you want to buy a home now.


Michelle Fox -

CNBC + Acorns

The price hike is almost everywhere.

Americans are paying more these days for the shopping cart and gasoline, thanks to rising inflation.

Of course, this rising inflation will also affect the cost of buying a new home.

[The Great Resignation has become a reckoning of low-wage workers and minorities]

“With inflation rising so aggressively and people's weekly wages and incomes not increasing at the same rate, we end up having less discretionary money to spend each month,” explained George Ratiu, director of economic research at the web Realtor.com.

At the same time, house prices have also risen.

The consumer price index, which measures the cost of goods and services, shows that housing rose 0.5% in October.

It takes into account the rent and the equivalent rent of the owners, which is what they would pay to rent their home.

Meanwhile, house prices rose 19.8% year-on-year in August, according to the S&P CoreLogic Case-Shiller indices.

What does all of this mean for home buyers?

First, they may have to cut their budget, according to Ratiu.

[Applications for unemployment assistance drop to their lowest level since 1969]

Not only will you have less money to spend each month, as you are paying higher prices elsewhere, but mortgage rates are also going up.

Median-priced home buyers are spending $ 160 more on a monthly mortgage payment than a year ago, according to an analysis by Realtor.com.

Ratiu hopes those guys keep climbing.

"In general, as inflation increases, mortgage interest rates increase," he recalled.

A hedge against inflation

Historically, real estate has been considered a hedge against inflation.

Home values ​​often keep pace with inflation, and when you have a mortgage, a fixed monthly payment is set for the entire term of the loan.

"Homes are expensive now ... but for most people the most important comparison is how the cost of home ownership compares to the cost of rent," explained Zillow chief economist Jeff Tucker. .

["It's a band-aid for a hemorrhage": they doubt that using oil reserves will lower the price of gasoline]

Rent is more unpredictable than a mortgage and more likely to go up.

He expects broader inflation to affect rental prices.


What has sparked the wave of resignations across the US?

Oct. 15, 202103: 17

"If wages increase or if the cost of building materials, appliances, light bulbs and paint increases, all of this will have an impact to some extent on the cost of maintenance and construction of rental housing," argued Tucker .

[Beer, chicken, toys, and even wheelchairs: why can't you buy what you need ... or why is it insanely expensive]

Supply and demand also influence rental prices, which were already up 10.2% nationally in September on a year-over-year basis, according to CoreLogic.

Tips for Home Buyers

Whether or not it is worth buying a home at this time depends on the situation of each one, according to Ratiu.

For most people, owning a home is having a haven, although historically it has been a good investment.

That said, there have also been times when home values ​​have dropped, he recalled.

Therefore, it is best to think about your budget and time frame.

If you plan to stay in it for at least three to five years, it makes sense, especially given the favorable interest rates, according to Ratiu.

Buyers have certainly faced stiff competition and bidding wars as there are a limited number of homes on the market.

However, Realtor.com predicts an easier time next spring.

[The Biden Government will take advantage of oil reserves to curb the rise in the price of gasoline]

A Realtor survey of 1,300 US homeowners this fall revealed that 26% plan to sell their home in the next 12 months.

That's more than double the results of its March 2021 survey.

"I believe that the year 2022 promises to offer less competition, many more homes to choose from and, consequently, much more affordable prices," said Ratiu.

With that said, there is some good news for those on the market right now.

While there are fewer listings to choose from between now and early January, there are even fewer competing buyers, according to Tucker.

"Historically, you are likely to get some of the best deals of the year," he said.

But don't be swayed by a home that may not be right for you because it may be available at a good price.

"The house is where your family is going to live every day," Tucker noted.

This article is part of the 

Invest in You Ready series.

Set.

Grow

 (Invest in you: Ready. Done. Grow), an initiative of CNBC and Acorns, the microinvestment app.

NBC Universal and Comcast Ventures are

Acorns

investors 

.

Source: telemundo

All news articles on 2021-11-26

You may like

News/Politics 2024-03-07T22:16:23.755Z
News/Politics 2024-03-27T16:24:51.018Z
Business 2024-03-23T05:44:23.481Z

Trends 24h

News/Politics 2024-03-27T16:45:54.081Z

Latest

© Communities 2019 - Privacy

The information on this site is from external sources that are not under our control.
The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.