Got a fence-sitting client?

You might consider discussing with that client Kayla Mathews’ four reasons to buy before 2020 as she outlined them in a recent article for InmanNews.

  1. When buying before 2020, your client could take advantage of year-end tax benefits.
    1. Remind your client that interest paid on mortgages are typically deductible, provided that interest does not exceed the limits outlined in the 2017 Tax Cut and Jobs Act. The same applies to property taxes.
    2. Remind your client that if she/he were to make energy-efficient upgrades on her/his newly purchased home, her/his tax breaks for making those upgrades are higher this year than they will be next year..
  2. Your client could take advantage of home prices being down in some markets and cooling home price valuations in other markets.
    1. According to Jonathan Miller, president of Miller Samuel Appraisal Company, some markets have excessive supply with declining price tags. “What was different in 2018, and will be even more marked in 2019, is that there will also be product coming onto the market that was held back in 2016 when the market started to soften.”
    2. Additionally, there will be some 8,000 new units coming onto the market during 2019. Miller told Mathews that he anticipates only 2,000 of those 8,000 units will sell.
    3. Miller suggested to Mathews that agents talk with their clients now about seizing such current decreasing/softening home price opportunities that may or may not hold in 2020.
  3. Mortgage rates are almost at historical lows and continuing to decline.
    1. Remind your clients that mortgage rates are dependent upon factors your client can and cannot control.
    2. Clients can control their credit history, their credit score and the steadiness of their employment history.
    3. Clients cannot control the rate of inflation nor the state of the economy.
    4. According to data from Bankrate in early September 2019, fixed-rate and adjustable rate mortgages are falling.
    5. Remind your clients that they have more buying power now than they had in the recent past due to those falling mortgage rates. How long those mortgage rates will remain low into 2020 is anyone’s guess.
  4. 2020 could bring more uncertainty to the economy than there is now.
    Remind your clients that Zillow’s Home Price Expectations Survey in 2019 indicated that 50% of real estate experts and economists anticipate a recession occurring in 2020.Several scenarios around a possible recession could be…
    – If the buyer already has the down payment amount saved, the buyer might get a bigger bargain in 2020.
    – If the buyer already has the down payment amount saved, the buyer could buy now in 2019 and begin building equity.
    – If the buyer does not have the down payment amount saved and loses her/his job in a recession, a possible purchase in 2020-21 could be further delayed.

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