Incline Village Real Estate:

Never before the last 15 years has it been less expensive to buy a home versus renting a home in Lake Tahoe!  There are two reasons;  1) Rents have risen so dramatically the past two years because of so many people wanting to rent a home because they either can’t afford to purchase a home, or have poor credit.   Landlords have been making a killing!  2) Home prices in Incline Village have been adjusted backwards to almost 2002-03 pricing.  AND, mortgage interest rates are at a 40 year low – around 4%!

To give you an idea of why today’s interest rates are such a key factor in today’s home buying equation, notice how much of a mortgage you are able to get today compared to 1991 for a $1,700 monthly payment.  With 1991 mortgage interest rates you could secure a $200,000 home loan.  With today’s mortgage interest rates you are able to secure a home loan for $350,000!  Do you now see the home buying power of a 4% interest rate in 2011?  And, it is expected we will have low mortgage rates for up to two more years.

These factors have created a result of the monthly mortgage payments on the median priced Incline Village home, including taxes and insurance, to be lower than the average rent levels in our region of Lake Tahoe.  And, don’t forget, all real estate markets are local, not national, so neighborhoods can vary with their rental prices and home values.

This moment in the housing industry is one of the most dramatic since the housing downturn.   However, it hasn’t yet increased the demand for home purchases.  Why?  There are several factors still holding people back from purchasing a home;

FEAR: The economy still has so much uncertainty to it, both nationally and globally.  So, often potential home buyers are paralyzed from taking action because of some many unknowns in our future.  There is still fear that prices may still fall lower so they don’t take action.

STUCK: Some Buyers would like to move to bigger properties, however they are stuck in their current home that has a mortgage more than the home is worth.

COSTS: In addition to taxes and insurance for a home owner, there are other costs – Homeowners Association dues, the maintenance of the home and more.  So, they view renting as less risky.

CAN’T QUALIFY:The potential buyer either doesn't have enough for the down payment,  or they can’t qualify because of the very tight lending requirements in place today.

In spite of above four reasons why people are not buying homes today, you may want to now seriously consider it.  I can’t remember in my 29+ years of helping people buy and sell homes when all the economic factors have lined up perfectly for home buyer.  In addition, you may be noticing that the current inventory of homes for sale in Incline Village is at the lowest level in years.  So, there are less homes to select from with an increasing Buyer pool who are ready to make a purchase.

If you are thinking of purchasing a home in the next six months, or you still have more questions regarding if it is the right time for you to buy a home.  I would like to apply for the job of being your Realtor.  Until next time…Tim Lampe