Joel Faircloth

As always, feel free to contact my team at www.joelfaircloth.com with any questions regarding Medford, Westampton, or any Southern New Jersey Real Estate.

7.) Home ownership builds equity Some people just don’t have the discipline to set aside money each month to save and invest. In this case, a home is more than a shelter, it acts as sort of an automatic savings account. You can build your savings in two ways: First, each month a portion of your payment goes towards the principal to build equity in your home. In the early years of the mortgage, most of your payment goes towards interest. Over time however, that turns around and your equity growth begins to accelerate. Second, U.S. home prices have always appreciated over the long term. Average appreciation on a home is 5-6 percent annually according to the National Association of Home Builders. Over time, history has shown that owning a home is a solid financial investment despite periodic market downturns.

6.) Market Timing is far from perfect No one wants to purchase a home only to see its value decline. But should you wait to buy a home until prices bottom out? A quick web search will yield a number of articles and opinions for and against timing the real estate market, but beware of those in favor or market timing who also want to sell you a how-to book or system. Many people who have tried to time the market miss out on the chance to build equity by waiting to buy until prices rise again. There are numerous charts out there that show the gradual increase - along with the typical ups and downs - of home vaues over nearly 40 years. The problem? Market cycles only become clear in retrospect. In the midst of a market slowdown, its very difficult to predict when housing prices hit their low points. In addition, most charts will show you prices at the national level, which may be very different than the housing prices in your neighborhood. Broad national indicators may lag the markets by months - meaning the actual price floor would not show up in reports until weeks or months later. Bottom line - the longer you own your home, the better chance you have of building wealth and protecting yourself from the markets ups and downs.

5.) There’s no such thing as “the real estate market” Most media reports about the housing market focus on national statistics such as sales volume and median home prices. The often-repeated statement that all real estate is local is often repeated because it’s true. It’s interesting to hear about the ups-and-downs of the U.S. real estate market, but those reports really are only useful in the context of local real estate markets. In reality, the national real estate market is made up of thousands of local neighborhoods, each with its own unique circumstances. The local economy, employment picture, tax situation, and government policies will have more influence on local housing markets than any national trends. That’s why homes in some neighborhoods continue to sell for the asking price, while across town others languish on the market despite numerous price cuts. The difference might be better schools, an exclusive location, or just a neighborhood with a prestigious name. Even within the same neighborhood, Victorian-style homes may be selling well, while Colonial models sit unsold. A condo with a striking skyline view will sell better than an identical unit facing a parking lot and a dumpster. That condo doesn’t have much impact in the national real estate market - and vice versa.

This week I will be posting the 10 best reasons to buy right now. I hope you enjoy! As always, please contact the Joel Faircloth Realty Group with any questions.

10.) The news is bad…for a reason.

Quick…which is the more exciting scenario?

A man walks down a flight of stairs, sometimes pausing or retracing his steps until he reaches a floor. After trudging around for awhile, he notices another staircase and begins ascending, occasionally pausing or taking a step back before methodically proceeding upward. A second man hurtles down a terrifically high flight of stairs. Ignoring the safety railings, he runs recklessly downward, dodging obstacles in his path as he goes. He suddenly cries out as he loses his footing, sails through the air, tumbles down several flights of stairs in a spectacular crash. The badly injured man has vital signs. Experts debate his condition but agree that the situation is dire and prospects for recovery are uncertain. …and that’s why more headlines say “Home values off the cliff in Phoenix, Miami and Las Vegas” than “Things aren’t bad in Seattle, Portland, and Charlotte.” Most readers just find sensational headlines more interesting. And while they may help sell newspapers, they also scare buyers to the sidelines, thought the news may be very positive for home buyers in particular.

9.) Uncle Sam wants you…to be a homeowner! Wouldn’t it be great if the government kicked in some money to help make home ownership more affordable? The Government passed an $8,000 tax credit (you DO NOT have to pay this back!!) for first time home buyers. In addition, because of deductions on mortgage interest and property taxes, the practical effect is that the government is subsidizing your home purchase. In fact, home ownership provides two of the best ways to reduce your tax bill.

8.) Long term, owning usually beats renting In recent years, the cost of buying a home in most markets has increased while the cost or renting remains flat. But its never a good idea to base long-term investment decisions on short-term conditions. If you decide to rent instead of purchasing a home, you may be in a bad spot if the cost of rentals in your area shoots up. Typically, a weak housing market corresponds with a strong rental market. If the rental market is strong in your area, it may indicate weakness in the local housing market, which typically favors buyers over sellers. When you buy a home with a fixed-rate mortgage, you can lock in a predictable monthly payment for 15 or 30 years. That means the largest part of your housing costs, principal and interest, are fixed. For some people, that stability,along with the sense of community that comes from being a homeowner, is enough to tip the scales to home ownership. If the monthly cost of buying vs. renting is comparable, you may consider some related factors to help you decide. When you rent, your landlord receives any appreciation and tax breaks associated with owning the property. If you plan on any significant remodeling buying may also be preferable to renting.