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<p class="wp-block-paragraph">I would tell you no if you had asked me a year ago if it was the right time to buy a house. But, if you asked me the same question today, I would say yes, I would take the risk and purchase even with all that&#8217;s happening with the increase in mortgage rates.</p>



<p class="wp-block-paragraph">This week the<a href="https://usafacts.org/data/topics/economy/economic-indicators/economic-indicators-and-actions/federal-funds-rate/?utm_source=bing&;utm_medium=cpc&;utm_campaign=ND-StatsData&;msclkid=f855e90f3d5a165145328d10266873cd"> Federal Reserve</a> raised interest rates by .25%, making it much harder for potential home buyers to get a decent mortgage interest rate. I understand the rationale behind the increase in helping to curb the inflation rate; however, purchasing a home at this time may be difficult for the average middle-class American. ;</p>



<p class="wp-block-paragraph">One of my colleagues has been trying to purchase a home for the last ten months. She planned to buy a multi-family house where she planned to live in one unit with her child and rent out the other. In that period, she reviewed multiple homes, expanded her geographic location, and adjusted the number of units she wanted in the house and the level of home repair she was willing to take on. Unfortunately, in the past year, the <a href="https://themortgagereports.com/85804/ct-first-time-home-buyer-programs-grants">average cost to purchase</a> a home in Connecticut has increased by over 7%, and mortgage interest rates have skyrocketed. Even with that said, there are financing opportunities for first-time home buyers. ;</p>



<p class="wp-block-paragraph">The <a href="https://www.chfa.org/">Connecticut Finance Housing Authority</a> has different financing programs which offer down payment assistance, closing costs, and a low-interest mortgage that potential homebuyers could explore (i.e., Time to Own). Additionally, many homebuyers&#8217; training and education are provided by CHFA and local banks and hardware companies. For example, my local credit union hosts monthly workshops to support its members through the home purchasing process. ;</p>



<p class="wp-block-paragraph">Even with all that said, would I purchase a house now if I were in my colleague&#8217;s position? The answer would be yes, from my little knowledge and experience, being a homeowner for six years. Over the past few months, I have scoured Zillow&#8217;s homes for sale and noticed the price cut. It has not been significant, but it thinks the real estate market is slowly tilting into a buyers&#8217; market. Sellers with good mortgage interest are holding on to their property instead of trying to sell and buy a new home because they cannot afford or want a higher interest. On the other hand, buyers are hesitant to buy because the home prices are still a little high. With an increase in interest rates, it is making it more unaffordable to buy a property and make the monthly payment without becoming housing cost burdened (spending more than 50% of income on the house). ;</p>



<p class="wp-block-paragraph">So, why yes? I am not a broker, agent, or financing officer, but my gut is telling me that if I had the funding in place, now would be a good time to start exploring and investing in a home. It is still being determined if interest rates will continue to rise. So right now, the mortgage interest rates that are in place are reasonable. As a homeowner, <strong>you can always refinance to a lower interest rate in a few years</strong>. I had to refinance my house a few years back to remove the PMI and escrow and request a lower interest rate. It was the best decision that I could have made as a homeowner. Removing those additional costs from my monthly mortgage payment provided financial relief because I could pay my property taxes and home insurance with credit if needed. Or, I can save the money for those expenses in a high-yield savings account and earn a small dividend on those dollars. ;</p>



<p class="wp-block-paragraph">Additionally, <strong>the land is finite, and housing costs will continue to increase as long as local planning and zoning regulations prevent new houses and buildings from being built in their communities. </strong>Even if those regulations get modified, it will take at least 5 to 15 years to make all the houses needed to meet the affordable home crisis in the U.S. The <a href="https://nlihc.org/gap">National Low Income Housing Coalition</a> estimated that the U.S. has a 7.8 million shortage of affordable homes for renters. ;</p>



<p class="wp-block-paragraph">If I had the means, I would enter the homebuying market. As long as you can pay your monthly mortgage payment, taxes, and home insurance, and still be able to afford other expenses and achieve your saving goals I would say go for it. However, since I am not currently experiencing what potential homebuyers are experiencing in their homebuying process, I reserve the right to be educated and stand corrected. </p>
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