Are you planning a home purchase in Tacoma, Washington in 2019? If so, this is a great place to start your research. In this article, we take a look at current Tacoma real estate market trends, mortgage rates, housing forecasts, and other topics essential to home buyers.
Is it a Good Time to Buy a Home in Tacoma in 2019?
With the end of 2019 fast approaching, many home buyers are looking ahead to next year. And many are asking the same question: Is 2019 a good time to buy a home in Tacoma?
Perhaps a better question would be; how much might it cost you if you wait? Home prices in Tacoma are expected to rise steadily through the end of 2019, just as they did in 2018. According to the Seattle Times Tacoma is one of the hottest markets in the country. With a limited inventory of only 1.3 months, and 49% of homes currently selling for more than the listing price, if you buy a home in Tacoma later in 2019, as opposed to earlier, you’ll probably pay more.
Another crucial consideration are your personal finances. Make sure buying a home in Tacoma Washington is the right move based on your lifestyle and current financial position. Do you have steady income? Do you expect that to continue uninterrupted for the foreseeable future? Are your current monthly expenses manageable? Do you plan to live in the area for at least the next few years? If you answered yes to these questions, buying a home in Tacoma may be a smart move.
What’s the Local Real Estate Market Like?
Tacoma’s real estate market is very competitive right now, partly due to an inventory shortage of homes for sale. Last month, local NBC affiliate King 5 News reported on the most recent snapshot from redfin for current market conditions,
A new Redfin study found Tacoma is the hottest housing market in the nation this spring. The real estate company said 50.2 percent of recently sold homes went under contract in just two weeks – and the typical home found a buyer in just eight days. Redfin said that’s the shortest median time on the market nationwide.
But even in a tight real estate market like Tacoma, Washington, there are several things you can do to increase your chances for success. Financing is a big part of it. If you’re thinking about buying a home in Tacoma in 2019, make sure you have your finances in order before you enter the real estate market.
For cash buyers, this means having the money in the bank, with bank statements to prove it. Home buyers using a mortgage loan can benefit from getting pre-approval by a mortgage lender. In a competitive market like Tacoma, sellers will want to know that you have your financing squared away.
As for home prices, housing analysts expect Tacoma’s real estate market to continue outpacing. According to Zillow, house values in the city rose by 9.2% in the past 12 months. Looking forward, they’ve predicted a gain of another 4.9% in 2019.
What Are Mortgage Rates Doing?
Mortgage rates surged during the second half of November. You can see this trend towards the middle of the chart below. As a result, we will likely start 2020 with 30-year loan rates averaging around 4%, or slightly above.
Looking forward, analysts with both the Mortgage Bankers Association and Freddie Mac expect interest rates to rise gradually throughout 2020.
This outlook, combined with the forecast for rising home prices, has created a sense of urgency for home buyers in Tacoma and across the Seattle metro area. In short, those who postpone their purchases until later in 2019 could end up paying more for a home, and for a mortgage loan. So there’s a lot to consider.
Good News: Higher Loan Loan Limits in Tacoma
Federal housing officials recently announced they would increase both FHA and conforming (conventional) loan limits for 2019. This is in response to significant home-price gains that occurred during 2018.
In 2019, the loan limit for a single-family home purchase in Tacoma is $726,525. This applies to both FHA-insured and conventional mortgage loans.
To be clear, borrowers can still obtain financing above these limits. It would just require a “jumbo” mortgage, and that often means a larger down payment as well.
Last year in June, the median home price for Tacoma was around $285,000. This means home buyers should have plenty of properties to choose from, within the FHA and conforming loan limits stated above.