The housing affordability crisis has been a growing problem for the last two decades, but conditions for affording a home are slightly improving — and there are key strategies prospective buyers need to know.
New numbers from the National Association of Realtors show existing-home sales are holding steady, and pending sales have also moved higher — a sign more buyers may be stepping back in.
Despite modest gains, it's still a tough market. Mortgage rates remain a major hurdle for many buyers, and prices are still elevated.
RELATED STORY | Federal housing agencies to allow alternate credit scores in mortgage applications
That leaves a lot of families weighing the same question: keep renting, or try to buy.
For Sharla Horton, renting means fewer surprise expenses — no appliances to replace, no HVAC repairs, no plumbing bills.
"I'm a single mom of three so for me it takes a huge burden off my day to day," Horton said.
With inventory still tight, more buyers are staying in rentals a little longer, even as prices continue to climb.
"There's just not enough inventory. So, when supply and demand says there's not enough inventory, prices go up," Tim Golding, state director of Americans for Prosperity of Michigan, said.
That's why home buyers who are ready need every advantage they can get. Experts recommend starting with the basics:
- Strengthen your credit.
- Shop around for lenders.
- Compare loan terms before you commit.
- Ask about rate buydowns.
In some cases, you or the seller can pay upfront points to lower your interest rate for the first year or two.
RELATED STORY | High mortgage rates create divided housing market as spring buying season heats up
"If you're able to buy, buy. You know that you can refinance it every 6 months if you wanted to," Johnny Reyes, a real estate agent and mortgage loan officer, said. "I wouldn't advise it, but that is an option you have at any point if rates drop to 2 percent, you have that option.
While the market is moving in the right direction, the path to homeownership still takes planning. For buyers, strategy can matter as much as timing.
