Waiting To Buy A House? It May Cost You More.

The housing market has been in a downward trend for four years. There is some speculation that inventories will not reduce any time soon which will be necessary for prices to rise. However, there are other factors that can increase the cost of housing, specifically mortgages. FHA accounts for a large percentage of the current housing loans and is expected to be even more prominent when the Qualified Residential Mortgage Guidelines go into effect next year.

  1. Rising rates are almost certain, due to looming inflation fueled by higher gas and food prices and the enormous amount of deficit spending
  2. FHA loan limits have been reduced – they are lower than conventional limits in most markets and FHA has suggested that they might be reduced further.
  3. FHA might increase the down payment to 5% or higher in an effort to have a more secure loan that will have less likelihood of going to foreclosure.
  4. FHA might decrease the amount of seller contributions in a similar move to require the buyer to have a larger investment in the home and therefore be a more “qualified” borrower.
  5. Congress may decide to increase the up-front MIP to build up the FHA reserves. The annual MIP has been adjusted twice since October 2010 when the Up-Front MIP was actually reduced.
  6. Due to tougher conventional requirements, demand for FHA loans could exceed maximum annual insurable limits. If Congress is having a hard time raising the limit on national debt, they might not even consider raising the limits for FHA.

In an effort to solidify the lending industry, qualifying is becoming harder for the buyer and more expensive at the same time. Many of the rules changes could go into effect next year. In addition, market factors could easily play a role in increasing buyer’s costs. Waiting will very probably require a larger up-front investment for buyers in the future.

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About papesellssatx

*Assisting people achieve their dream of owning or selling a home with professionalism and excellent customer service *ABR, MRP, PMN, CNAS, TRLP Graduate *Licensed Texas REALTOR® #0207820 *Active member of the Women's Council of REALTORS®, Texas Association of REALTORS®, National Association of REALTORS®, San Antonio Board of REALTORS® and a TREPAC Contributor. *Love REFERRALS and love to REFER... *WHO IN YOUR CIRCLE OF FRIENDS IS THE MOST LIKELY TO MAKE A MOVE NEXT? *Whether you are moving to, from or within San Antonio, surrounding areas or anywhere in the United States, I am here to assist you. www.trudypape.com Coldwell Banker, D'Ann Harper, REALTORS® 7523 North Loop 1604 West San Antonio, TX, 78249 Texas Licensed REALTOR® #0207820 Texas law requires all real estate licensees to give the following information about brokerage services to prospective buyers, tenants, sellers and landlords. http://www.trec.state.tx.us/pdf/contracts/op-k.pdf
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