A lot of would-be homeowners are holding off on buying right now due to mortgage interest rates continuing to rise.
At the beginning of 2023, rates were under 6.5%. Now here we are in October and those interest rates have risen to 7.49% - the highest they’ve been since 2000 - and Realtor.com is suggesting the rate may reach 8% before the year is out!
Because of these high interest rates, a lot of people are waiting to see if maybe those numbers will go back down and make the cost of borrowing money a bit cheaper.
Of course, the other factor is the cost of homes themselves - which also continue to climb as many homeowners are holding on to their property to remain locked into their old (lower) interest rates and gain more equity so their home’s value continues to climb.
Because of these two factors, waiting in hopes of lower interest and lower prices could result in spending more money down the road.
Consider the following chart created by my lender Ismael Bastida. It shows how much more money waiting could cost you. As you’ll see, the only way waiting will work in your favor is if prices drop by at least 5% and/or if rates drop to pre-2023 numbers... both of which are unlikely to happen any time soon, making buying now ideal.
But what happens if I buy now and house prices drop?
You haven’t lost anything as you won’t feel the difference until you’re ready to sell. For most, that means you’ll be living in your home for 5-10 years or possibly longer. By then, there’s a good chance prices will rise once more - plus you’ll have built up equity in your home to make for a more profitable sale.
What if I buy and then prices and rates climb even higher?
That’s great for you! If you buy now and the rates and prices continue their climbing trend, you build equity while taking advantage of tax benefits AND get locked in at that lower rate! That’s a win all around!
What about if interest rates go back down after I buy?
You could always refinance at a later time for a lower interest rate.
But let me ask you this: What happens if you don’t buy now because you’re waiting, and those rates and prices continue to climb?
You’ll be renting longer than you want to, and missing out on prime opportunities.
So what should you do?
Reach out to me (scroll down for the contact form) and lets get started finding a great home for you!
OR you could download get my app to start looking at properties yourself and contact me directly.