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Residential financing may help homebuyers in today's housing market

Posted on Wednesday, August 28, 2013 at 1:19:04 PM

As the housing market continues to evolve, changing factors make residential financing that much more important as a tool for buyers to purchase their perfect homes.

Inventories increased in June, marking the sixth month in a row where numbers climbed back toward normal, according to data from Realtor.com. In addition, list prices also rose year-over-year, with figures holding more than 5 percent higher than the same time last year. 

While higher prices might mean more listed homes, it also may become a detriment for buyers. However, Patrick Deady, vice president of Home Loan Investment Bank, recently offered some advice for home buyers looking to take advantage of residential financing. 

"Rising real estate prices do make it more difficult to afford homeownership," Deady explained. "In addition, rising interest rates can eliminate some potential borrowers sending inventory even higher."

That shouldn't deter most buyers, and Deady offered several great steps to purchase in today's climate.

"There a few things prospective home buyers can do to prepare for homeownership," Deady added, and to get started borrowers should "prepare a budget which takes into account all of your expenses and determine what a comfortable housing payment will be for you. Take care to include future home maintenance costs."

Planning ahead is key to getting the most out of residential financing.

"Consult with a mortgage professional about your budget and get pre-approved to buy a home," said Deady. "Meet with a real estate professional to determine what type of home and community best suits your needs."

Moreover, inventories and home prices are directly related to buyer confidence, and the more comfortable people feel regarding real estate the stronger the sector may become.

"Consumer confidence is an important component in growing home inventory," stated Deady. "Higher consumer confidence results in greater demand which can counter growing home inventory and balance supply. The result can be more stable housing prices or even lower prices."