What you need to know if you are thinking of buying a home in 2020 in Phoenix AZ
Whether you’re looking to buy or sell a home in 2020, it helps to know what you’re up against. Here are things to expect if you and your family are considering buying a home in Phoenix area.
Interest rates are expected to stay low
Most economists expect that 2020 will present a continuation of the low-rate environment that has dominated this year. Economists predicted that the 30-year fixed-rate mortgage will average between 3.60% and 3.85%. The Fed has also reinforced this message, saying that their intention is to keep rates low. We will have to see how inflation plays out, but this is great news for our home buyers!
Here’s how industry predictions shake out:
Fannie Mae: 3.6 percent
Mortgage Bankers Association: 3.7 percent
Freddie Mac: 3.8 percent
Redfin: 3.8 percent
Realtor.com: 3.85 percent
The most important consideration for most buyers when looking to buy a home is how much you can afford. Mortgage rates can be difficult to pin down with precision.
2020 new conventional mortgage limit in Arizona
Conventional – new limits for all loans delivered after 1/1/2020 will be $510,400. This means First time home buyers using (3% down payment) can buy at a maximum purchase price of $526,185! 5% down Owner Occupant Buyers can buy at a maximum purchase price of $537,263!
2020 new FHA loan limits in Arizona
FHA-insured mortgages are now available for loan sizes up to $331,760 for one-unit homes starting 1/1/2020. This means that the maximum purchase price using minimum down payment (3.5%) would be $343,792.
Home price in Phoenix area are raising
The house value for single family home in Phoenix had been increasing since 2011. Based on 2019 Phoenix Arizona Housing Market Trends Report, home price for single family homes has increased about 6% from a year ago. Median sold price for single family home in 2019 was $280,000. The median sold price for single family home in Phoenix has increased about 5.7% from 2018. Average sold price for single family home in Phoenix AZ was $345,547, and that was about 6.4% increased from 2018.
Inventory, inventory and inventory
Real estate sale is relying on supply and demand. As Phoenix and Maricopa County have ranked first in fastest-growing cities and counties (again), lack of housing inventory, especially for entry-level homes, has been a thorn in buyers’ sides since 2018. The situation isn’t expected to get much better. Inventory had been decreasing from a year ago. In Phoenix, there were 20,177 new listings for single family homes for sale in 2019 compare to 21,282 in 2018, that’s about 5.2% decreased from a year ago.
Down Payment Assistance Program still available
Down Payment Assistance Programs such as Home in 5 and Home Plus still available. These down payment assistance program provides a 30 years fixed rate mortgage with a down payment assistance (DPA). These down payment assistance can be used toward the down payment and or closing costs. The DPA is equal to a percentage of the first mortgage and is proved in the form of a three-year, no interest, no payment, deferred soft second mortgage. The DPA is forgiven monthly at a rate of 1/36 over the term of the lien. Basically home buyer with go with DPA program have to keep the mortgage for at least 36 months. If home buyer sell or refinance their home during this 36 months, they will have to pay it back. Keep in mind that these program is not just for first time home buyer.
Wondering how much house you can afford?
Click here to access the Mortgage House Payment Calculator. Simply add in the price of the home you are considering and the calculator will return your estimated house payment. Change length of loan and interest rates to adjust results.
New Listing in Last 24 hour Phoenix AZ
Swee Ng, Realtor and Phoenix East Valley resident specializing in win-win real estate transaction through great communication and fighting for his clients’ best interest. After all, this is more than real estates, this is about your life and your dreams.
If you are looking to buy or sell your home in Phoenix AZ area, we hope you will consider us. Contact us today for complimentary consultation.
Search and view your dream home your way
Receive email alert as soon as a Phoenix property matching your criteria hits the market. Be one of the first to see new listings. Simply type in everything you want in a house and save your search here to be notified.
How can we help you to achieve your real estate goal in 2020?
