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Workforce habits: Local homebuying trends continue to vary across the country. But as you would expect, major metropolitan locations and areas popular with the country’s new remote working population remain stubbornly expensive and at times challenging markets.
With buyers facing increasing financial pressure and interest in the once red-hot housing space cooling overall, how can shoppers navigate an increasingly unpredictable homebuying market? With a historic sellers’ market possibly transforming into a buyers’ market, first-time homebuyers are learning about additional requirements to qualify for a home.
Bottom line: It would be in your best interest to keep a close eye on what happens over the next few months. With big changes anticipated to impact the housing market here shortly — many of which may play in your favor — a few simple shifts in real estate strategy and financial planning could serve you well.
Here’s how you can take advantage:
- Lock in a mortgage rate now to lower costs and safeguard against interest rates continuing to go up even further.
- Save money longer and put a larger down payment on your home purchase. You’ll borrow less and lower your monthly fees.
- Move to a nearby town or suburb vs. a larger city. City housing markets have significantly higher home prices and monthly mortgage expenses in exchange for a minimal commute.
- Look at properties that have been on the market for 30 to 60 days or more. These sellers are motivated to adjust their pricing or selling terms.
- Wait a season to purchase a property. During the fall and winter, there are fewer buyers and sellers tend to offer better pricing and discounts.
- Apply for unique loan types tailored to your individual financial and living situation. It may help you secure alternate forms of financing that can help you stretch your budget further.
Home loan and refinancing options to explore
Fixed Rate: A conventional mortgage that maintains its original (fixed) interest rate for the entire 15-year or 30-year term of the loan. Typically secured with a 20% down payment. If making less than a 20% down payment, mortgage insurance payments will be added to the monthly mortgage payments.
Adjustable Rate Mortgage (ARM): A more flexible loan type that offers a lower monthly fixed payment for a preset number of years. Afterward, it adjusts to a potentially lower or higher interest rate, depending on current market terms after this initial period expires.
Jumbo Loans: Used if the purchase price of your home exceeds conventional loan limits ($647,200). Please note: This can be higher in certain counties with significantly higher median home prices.
Refinance: Allows you to buy out an old mortgage (e.g. from another lender) and secure a better rate or extended repayment period by applying for a new one.
Cash-Out Refinance: Leverages equity in your house to let you consolidate high-interest debt to a lower rate or perform home improvements.
80-10-10 Loan: Provides a way to buy a new home with less than a 20% down payment while avoiding private mortgage insurance (PMI) fees. You pay 10% down, then obtain a mortgage for 80% of the new home’s asking price, and a second for the remaining 10%.
Modification: Already have an existing American Airlines Credit Union home loan? For a small fee, it’s possible to explore interest rate or loan program changes.
Home Equity Line of Credit (HELOC): Lets you borrow against current home equity to invest in a new property or home improvements and repay this money over an extended period. The Credit Union also offers an unprecedented, fixed-rate HELOC option.
Unique Loans: The Credit Union also offers access to a variety of unique loans, including those that provide special offers for first-time homebuyers, or those seeking investment properties or vacation homes.
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Money lessons
Parents often remind their children that money doesn’t grow on trees. But there’s more to the lesson.
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Guiding others on their financial journeys
As a Financial Wellness manager, Jamie Fatheree is focused on improving members’ financial standing no matter where those members are on their respective journey.
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Stop overspending
Six habits for successfully reducing your monthly expenditures.
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Equity is king
The current market has opened additional demand for Home Equity Lines of Credit, or HELOCs. These loans give homeowners access to the additional equity in their homes and can be used for remodeling or renovations, meeting current financial demands or funding other endeavors.
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Out with the old
One of the things I love about the beginning of a new year is the idea of endless opportunities. We’re continuing to make improvements to better serve you while helping you plan for whatever comes tomorrow.
