Challenges and Opportunities of Buying a Home in 2014
- posted 1.27.2014
- Britany Linton
- Home Loans
We've talked previously about the new mortgage regulations facing lenders and home buyers in 2014, but you may face a few other challenges when it comes time to buy a new home this year.
Challenge: New Regulations
Many people are saying that new regulations will make it harder for buyers to qualify for a mortgage, but really it just means that buyers and lenders will have to work closely together to make sure everyone is getting the best deal possible. As the housing market recovers, lawmakers have created measures to help prevent future market crashes – which include stopping risky mortgages. So, while buyers may have to work a bit harder to prove their finances are in order, they can also remain confident that they will be able to safely handle their loan.
So new regulations might mean that buyers have to delay a purchase for a few months until they can repair their credit or save for a larger down payment, but remember that the loan officers at New American Funding will work with you to find a loan that fits your finances.
Opportunity: More Homes, Fewer Investors in the Market
In 2013, many home buyers had a hard time competing for homes due to cash-rich investors snapping up properties. This year, rising prices will mean more sellers returning to the market, but buyers can expect to be more competitive as fewer investors look to snap up cheap homes. While this might mean higher prices, it also means a more manageable market for buyers.
Challenge: Low Interest Rates May Slowly Increase
As the economy has bounced back, interest rates have been slowly increasing. The Federal Reserve has held interest rates low to ensure the market stays healthy, but it has started to step back from those efforts. The good news is that, while rates are no longer hovering around 3 percent, they are still much lower than they were before the bubble burst, so buyers still have plenty to be excited about in 2014.
Opportunity: Different Mortgages
Like the new regulations, we're also being more careful with the loans we provide. Risky mortgages are disappearing, and for good reason! While the industry adjusts to the new rules, buyers may see more conventional loan options, but they can remain assured that the loans are safer and more consumer-friendly than those in recent history.