What If I Wait Until Next Year to Buy a Home?

 

What if I Wait Until Next Year to Buy a Home?
Home Buyer Now or Wait Until Next Year?

Good News: Increases in home prices and historically low interest rates means you can be a home buyer now!

recently shared that national home prices have increased by 6.7% year-over-year. Over that same time period, interest rates have remained historically low. This has allowed many buyers to enter the market. This is good news!

As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.

The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Index Reporthome prices will appreciate by 5.2% over the next 12 months.

What Does This Mean for you, the Buyer?

If home prices rise by 5.2% over the next twelve months, as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:

Predictions that mortgage interest rates will rise next year means it is a good time to buy now. Waiting could mean an increase in monthly payment of $153.81, $1,845.72 annually, and over 30 years, $55,372 on a $250,000 mortgage today.
Impact That an Increase in Interest Rate Would Have on a Mortgage Payment for a New Home Buyer

Bottom Line

If buying a home is in your plan for this year, doing it sooner rather than later could save you thousands of dollars over the terms of your loan. Amazing how that difference in monthly payment adds up over the years.

Contact me. I am happy to discuss your situation today!

A full-time agent with RE/MAX for 17 years. Marketing Business Degree WCSU. Volunteer Danbury Hospital. RE/MAX Executive Club. Read More…