Is Now the Time To Buy A Home In Naples Florida?

Is Now the Time To Buy A Home In Naples Florida?

Timing couldn't be better to buy a home in Naples Florida... How much more could get the point across? Recent national press releases underscores the fact that Naples Florida is one of the most over-corrected real estate markets in the country. That means prices have fallen far below the actual value. Bottom line is the prices are great and inventory is still ample. So...what's holding you back from owning a prime piece of Paradise?

We understand that one size rarely fits everyone and the same goes for advice. For many people with job security and who don't own a home and for people with good credit scores and enough savings for a down payment, there may never be a better time to buy a home. Homes have had a significant price correction but in many markets, they have started to rise again and that's true in certain areas of Naples. The lower prices combined with historically low interest rates make this an opportune time to buy a home or vacation property if you can afford it.

One of the reasons homes are an attractive investment is that fact that you can use a small down payment and finance the balance for 30 years. The principle, called leverage, allows you to earn a return on the value of the home rather than the actual cash investment. Small appreciation can create a large rate of return on the initial investment of the down payment and closing costs. Take, for example, the following projection at the end of five years for a $175,000 home with 3% closing costs and a 5% interest rate for a 30 year term. The rate you see in each column is an annual rate of return based on the equity of the home at the end of the five year period due to both appreciation and amortization of the loan.

The nature of positive leverage will cause the returns to be higher with a smaller down payment. As you see in the table, the return is higher on the 3.5% down payment than with the 10% or 20% down payment. If you're curious to see if this advice might fit your situation, you really need to sit down with a knowledgeable real estate professional who can help you assess your position. It's worth the time because there may never be a better opportunity than now.

Call us and we'll get you started with the loan qualification process so you can start packing!

Is Now the Time To Buy A Home In Naples Florida?