The SCOOP! Blog by ChangeMyRate.com® 'Your Best Rate Guru'

Is buying a home affordable today? The answer is yes and no. It depends on a variety of factors, including where you live.

If you are thinking about buying a home, here are four reasons to do it today:

• Mortgage rates are low. With the average 30–year fixed mortgage rate hovering around 4%, monthly mortgage payments are affordable for the average household despite currently–high house prices in many markets.
• Fixed payments offer stability. With a 30–year fixed–rate mortgage you'll enjoy the stability of fixed payments for the life of the loan — even if mortgage rates go up. This is particularly helpful for first–time homebuyers who are early in their career and can expect their income to increase as their careers progress.
• Homeownership can help build wealth. Homeownership has proven to be an effective way to build wealth over time. In fact, estimates suggest that homeownership increases net wealth by $9,000 — $10,000 per year.
• Homeownership offers tax benefits. You can deduct mortgage interest from your yearly taxes, and, when you're ready to sell, a large portion of capital gains on the sale of your home are generally tax exempt.

At the same time, homebuyers in today's market face some hurdles, too. Here are four to consider:

• Housing is expensive. Housing prices have risen an average of just over 6% per since the trough in 2012, and they show no sign of slowing down.
• Income is not keeping up.  Income increases are lagging house price increases —  average income has only been rising by about 2.4% per year.
• Where you live makes a difference. In some parts of the country, housing is very expensive. In other parts, it remains very affordable. For example, the median house price in Hawaii is $633,446, while in Ohio it is $126,370.
• Finding a home can be hard. Residential home construction is not keeping up with pent–up demand, particularly if you are looking for a starter home. The imbalance between the demand for and supply of homes contributes to more expensive homes.

The bottom line: Even with some of the challenges homebuyers face in today's housing market, current low mortgage rates offer monthly mortgage payments that are more affordable than at almost any time in history. Of course, that's not the only thing you have to take into consideration.  Buying a home is a big investment — perhaps the biggest you'll make in your lifetime — and it comes with responsibilities that you must be prepared for.

Courtesy of Freddie Mac - To view the original article click here