Homeownership Investment

Even though interest rates have dipped below 6%, I still hear people saying how they’re going to “wait to buy until rates are below 3% again”. 

This is a terrible idea.  I understand, 6%, 7%, – even 5%, interest rate changes the amount of house you can afford.

But stay with me, there’s more to consider than rate alone.

Historically, Not likely

While you patiently wait for interest rates to drop (to historically, once in a lifetime low levels), home prices have historically, and are predicted to continue to outpace inflation.  Even in slow markets in slow markets home values have outpaced inflation.

Fixed Rates vs. Increasing Rent Costs

Rent prices are resetting, and increasing each year.  By renting, you build equity for the landlord, not yourself.  Rents on average, go up every year.  However, with a fixed rate mortgage, you know exactly what your monthly payment will be (for the next 20 to 30 years).

Buyers can be picky

Right now, (with inventory being exceptional in many markets), Buyers have many options and can often find a good deal on a great house. 

Seller Concessions and Rate Buy-Downs

Many Sellers are willing to offer a Buyer concession of some sort, and really the best option (imo), over the long haul of the mortgage loan is a rate buy-down.

Lower Interest Rates, Higher Overall Sales Price

Waiting to buy until rates are exceptionally low puts you in direct competition with other Buyers.  This leads to bidding wars, offers over asking price, limited supply and not enough time to make an informed decision.

Waiting to buy a home is waiting to invest in your future, and put plainly, a gamble.

Assuming we’ll ever see interest rates that low again, is the real risk. 

Homeownership is an Investment in your Future.

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