Foreign Money Purchasing Strong in the Pacific Northwest

Wealthy Chinese are sinking billions of dollars into Puget Sound area real estate, and by doing so they're making a clear-cut business case for protecting the environment and spending money on education. The influx of foreign buyers, mostly Chinese, was one of the top real estate stories of the 2014. It's not just that many foreign nationals are buying here. Rather, it's how they're executing transactions, with some paying all cash for pricey assets.

Why Buy Now?

WHY BUY?

There are plenty of good reasons to buy your home. Here are just a few.

· You’ll own it. You’ll have a place to call your own, a place to raise your children and a chance to become a part of your community. You can pass your home down to your children and their children, creating security for generations to come.

· Your payments may be less. When you buy your home, your monthly payments are often less — and you own it in the end. Homeownership can also reduce the federal income taxes you pay because you can deduct your mortgage interest and property taxes on the tax returns you file each year. These tax savings partially reduce or offset the actual cost of owning your home.

· Your payments may never increase. If you choose a mortgage with a fixed interest rate, you’ll make the same mortgage payment each month for the entire 30 years of the loan.

· You’ll build a big nest egg. Owning a home is the single greatest source of financial security and independence for the majority of people who have taken this step. You can experience that sense of security, too.

WHY BUY NOW?

Current market factors make NOW a great time to buy a home.

· Low interest rates. Mortgage rates have returned to near-record lows, reducing monthly payments substantially.

· Competitive prices. Prices are attractive in today’s slower market and will rise again when the housing cycle turns up.

· An improving mortgage market. Lenders are making loans to borrowers with good credit, and Congress and the White House are pursuing ways to make loans more available to first-time buyers and buyers in high-cost markets.

· Great selection. It’s easy to find the home you are looking for at a price you can afford.

· Energy efficiency. Today’s new homes are designed to save you money on your monthly utility bills, and increasingly incorporate new green technologies. See the RE/MAX Parkside Green Home Guide for more information on green homes.

Pacific Northwest renting vs. buying

So what happens if rates jump:  Here are some raw statistics to contend with.  Let’s say a person is committed to paying at most $1,000 per month in principal and interest to be comfortably within this person’s budget.  A mortgage calculator will spit out that at a 3.9 percent rate (last week’s rate), this homebuyer will be able to take out $212,000 in mortgage amount.  At 4.5 percent (near future rate), the figure drops to $198,000, or the equivalent to a drop of 7 percent in purchasing power.  The homebuyer therefore has to shoot for lower price points.

Some more reading on rates rising