Real Estate Information

Columbus for Buyers: Late 2011 Happenings

The last quarter of the year can often be a tough stretch for the housing market, whether it’s taking place in Columbus or anywhere throughout in the nation. This year, the early Columbus statistics from the last few months have seemingly been able to buck that trend, especially with profitable home sales in the fall months.

The statistics from the Columbus board of realtors has showed that area homes experienced a clear upgrade in sales paired against the fall of 2010. There was an 8.6 percent increase in the amount of sales in October of this year as 1,543 homes were purchased. A similar frame of time in 2010 only produced 1,421 homes sold, which is a great sign for the Columbus real estate market.

Another interesting statistic for potential buyers is the continuing upswing of rental rates, both throughout the country and in the Columbus area. Many individuals, couples and families who are potential buyers are on the fence between renting. With mortgage rates reaching all time lows, the fact that Columbus apartments have experienced an eight percent increase in rates this year could drive some to look more towards buying instead of renting.

The overall sales statistics throughout the year have been a little behind the last year’s rate, but the increase in the last four months should close the gap by the end of December. Through October, the sales were just 2.1 percent behind the 2010 rate, as October and November again saw a jump in buying contracts, something that’s occurred for six months in a row now.

Median sale price is down considerably from the outset of 2011, which has certainly tilted towards the buyers favor. It’s down about six percent from early last year and two percent from the early months of this year. While the fourth quarter of the year certainly isn’t usually a time of high sales, Columbus’ track record through the fall could change that. Mortgage rates, combined with median sales prices that are percentage points lower are two heavy factors weighing for potential buyers.

The Columbus market is benefitting from homes that are quality and affordable this year. Because the mortgage rates have dropped to record levels, potential home owners and investors are more likely to make the decision to buy than any time in the last few months or years for that matter.  

I'm often asked if this is a good time to buy a home. Some clients are concerned that home prices may fall further than they have already. They are assuming that the best course of action is to wait for the bottom in the market and then buy. The problem with this approach is that you don't know where the bottom is until you see it in the rear view mirror, meaning until you've missed it!

Home prices are one factor in determining your cost of ownership, but so are interest rates and financing availability. Even though interest rates have gone up in the last six months, they are still near historic lows. Since your monthly mortgage payment is a combination of paying down your principal and paying the interest owed, if home prices come down a little further but interest rates up, it could cost you even more to service a mortgage on an identical home!

While a home is a major investment, it is also the center of your personal life. It's important to live in a home that reflects your taste and values, yet is within your financial "comfort zone." To that end, it may be more important to lock in today's relatively low interest rates and low home prices, rather than to hope for a further break in prices in the future.

Please give me a call if I can be of any assistance in determining how much home you can afford in today's market.