If you’re thinking of buying a home, the time to act is now.
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Should you buy a home in this market?
At 0:34 in the video above, you can see an infographic we’ve been sharing on our Facebook page that answers this question. Basically, if you buy a $350,000 home at an interest rate of 2.5% (you read that right—that’s the average fixed interest rate at the moment), your monthly mortgage payment would be $1,106.
Don’t like those high prices? Well, let’s say you waited to buy, prices were to drop drastically, and the same $350,000 home was still on the market, except now for $300,000. It’s worth mentioning that I’ve never seen this type of price drop happen before—even during 2008 and 2009, it took at least a year for prices to drop just 10% to 12% in our area—but regardless, let’s say that’s the case. Even if prices were to drop in the near future, interest rates will most likely rise during that same time. In 2008 and 2009, for example, they were in the 5% to 6% range.
If you’re like most people and need a loan to purchase a home, I recommend buying now while rates are low.
So for the sake of this example, imagine you bought that $300,000 home at a rate of 4.5%. That would increase your monthly mortgage payment to $1,216. In effect, you’d be paying $110 more per month for a home you thought you were buying for $50,000 less.
If you’re able to pay cash for a property, I’d probably wait to buy, but if you’re like most people and need a loan to purchase a home, I recommend buying now while rates are low. At some point in time prices may go down, so the smart play would be to pay a little extra on your house payments now so you can start paying down the balance on your home and gain more equity. The bottom line is that as interest rates rise, it will cost you more to buy a home. I never thought I’d see rates as low as they are now, so take advantage of this while you can.
If you’d like to know more about your home-buying options or want a recommendation for a good lender, don’t hesitate to reach out to me. I look forward to hearing from you and seeing you buy your dream home.
If you’re able to pay cash for a property, I’d probably wait to buy, but if you’re like most people and need a loan to purchase a home, I recommend buying now while rates are low. At some point in time prices may go down, so the smart play would be to pay a little extra on your house payments now so you can start paying down the balance on your home and gain more equity. The bottom line is that as interest rates rise, it will cost you more to buy a home. I never thought I’d see rates as low as they are now, so take advantage of this while you can.
If you’d like to know more about your home-buying options or want a recommendation for a good lender, don’t hesitate to reach out to me. I look forward to hearing from you and seeing you buy your dream home.
