Home Buying Opportunities in Northern Virginia

There is a historic trend going on right now in the home buying market. When the housing market crashed in 2007-2008, a huge opportunity was created for those looking to purchase a home. Mortgage rates decreased to historic lows in 2012 and home prices themselves came way down.

The combination of these factors pushed the “Housing Affordability Index” published by the National Association of Realtors to a record high.

According to a recent article: “There is concern that these trends are starting to reverse. Increased talk of tapering of monetary stimulus by the Federal Reserve has provided the impetus for the rise in interest rates in recent weeks.

There is rift of opinion over where interest rates go next, but some prominent voices in the market – Goldman Sachs, for example – say the sell-off in the bond market is “for real” this time, and rates will continue to rise from here. Meanwhile, house prices have been flying higher, and it looks like the market has carved out a bottom.

“After making a peak to trough decline of 33.8% from April 2006 to March 2012, the Case-Shiller home price index (C-S) has since advanced +10.9%,” wrote Deutsche Bank Chief U.S. Economist Joe LaVorgna in a note yesterday. “The fact that C-S gains have been so broad-based suggests to us that they should persist, because we have found that breadth is often a sign of durability.”

If both interest rates and house prices continue to rise, housing affordability will go down, and the historic opportunity will be over. However, the good news is that housing affordability shouldn’t go down all that much, even if it comes off its peak levels.

The housing affordability index, which includes interest rates as well as income and prices in its calculation, remains just shy of its all-time record high. This was not the case in the last downturn, when affordability was very low, owing to a bubble-like rise in home prices that did not jibe with the fundamentals. But what about interest rates—are they not artificially low and therefore the primary reason why affordability is so high?”

The short answer to this question, we believe is no. For more information on buying homes in Northern Virginia and how these trends are affecting prices visit our home buying page. Don’t miss this historic opportunity!

About Ashley Leigh

Ashley Leigh is one of the most successful real estate agents in the United States and founder of Linton Hall, Realtors®, the premier real estate company in Prince William County, Virginia. In his book Billion Dollar Agents, Steve Kantor featured Ashley for individually producing well over $2 Billion in career sales selling thousands of homes. Ashley Leigh's innovative marketing programs have been have been written about in Fortune magazine. Additionally, Ashley has been profiled in RISMedia’s Real Estate Magazine and Power Team Report and has been recognized by REALTOR Magazine as one of the Top Sales Agents in the U.S. The Wall Street Journal ranked Ashley as one of America’s Top 20 Realtors in the Nation for his sales production for several years. Connect with Ashley on Google+

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