Real estate prices have always had their ups and downs, and in the last year or two, they have certainly been in a down cycle. Over time, however, the median price of a home in the United States has consistently risen.
In the 30 years from 1968 to 1998, the median home price rose from $20,100 to $128,400, according to the National Association of Realtors. Anyone who stayed with their 30-year mortgage during this period was a big winner.
After only five years, the price of the $20,100 median home rose, on average, to $28,900.
The median price in 1978 was $48,700, and by 1988, it was $89,300, which means very significant gains were made within 10 and 20 years.
The NAR study shows that the average annual price increase in the 36-year study, from 1968 to 2004, was 6.4 percent.
What does all this mean now?
This is such an exciting time for home buyers!
First, while prices are no longer falling in most parts of the country, there are still many bargains available.
As prices recover more, buyers will find that the value of a home bought in 2010 will probably increase at a greater percentage than the 6.4 percent average. That’s because they bought their homes for less than they were actually worth.
While mortgage interest still hovers at 5 percent, buyers will be able to lock in this low rate for 30 years .
That interest rate won’t be available much longer. If you are a buyer, don’t take too long to make a decision.