Why Southern Maine Homeowners Don't Regret Their Purchase

In light of the recent increase in mortgage rates, inflation, and talks of a potential economic downturn, many prospective homebuyers are left wondering: is buying a home this year still a sound decision? Despite the unique challenges that this year brings, it's crucial to keep in mind the enduring benefits of owning a home.

Ponder this: if you talk to individuals who became homeowners 5, 10, or even 30 years ago, it's unlikely that you'll find someone who regrets their decision. Why? The answer lies in the consistent growth of property values over time and how it consequently increases your wealth. This could explain why a recent survey by Fannie Mae revealed that 70% of respondents consider purchasing a home as a secure investment.

Let's delve into how home price appreciation can significantly accumulate over the years.

The Evolution Of Home Prices

The following map, utilizing data from the Federal Housing Finance Agency (FHFA), illustrates the remarkable increase in home prices over the past five years. Given the regional variations in home prices, the map is divided into regions to better illustrate the broader market trends.

Looking at the percentage change in home prices, it's evident that, on average, home prices have surged by just over 56% nationwide over a span of five years.

While some regions slightly deviate from this average, it's clear that home prices have made substantial progress in a relatively short time. Extending this timeframe further emphasizes the profound benefits of homeownership and the substantial gains homeowners have made over the years (refer to the map below):

The second map indicates that, nationwide, home prices have appreciated by an average of over 290% over approximately 30 years.

This average reveals that a typical homeowner who bought a house three decades ago has seen their home value nearly triple during this period. This is a significant factor behind why many long-term homeowners are satisfied with their decision.

Contrary to some predictions made towards the end of 2022 that home prices would plummet, this did not materialize. Even though home prices have cooled off from the record highs during the 'unicorn' years, they are already showing signs of recovery in many regions. This suggests that, in most markets, the value of your home is likely to increase over the coming year.

The other option is to rent, but rental prices have been on a steady rise for decades. So why endure yearly rent increases without any long-term financial gain? Instead, contemplate becoming a homeowner.

Final Thoughts

If you're uncertain about whether it's still prudent to buy a home today, bear in mind the remarkable long-term advantages of homeownership. If you're ready to explore this further, let's start a conversation today.