What would you do if you could lose $60,000 in the next year?
If you are thinking of buying a home next year, let me show you how waiting could cost you!
Two major factors are expected to change in the next year which would impact your home purchase: rising home prices, and rising interest rates.
Let’s look at some numbers: imagine you can qualify to buy a home this year for $300,000. If you put 5% down and buy out the mortgage insurance your payment could be close to $1600/month. Now imagine you want to wait to buy a home until next year. Will you be able to get the same house? If so what will the monthly payment be?
Factor #1 – Rising home prices
Economists predict that home prices will rise close to 5% in the next year. On a $300,000 home that’s a $15,000 jump in price. If you bought the home today, that’s increased value in a home you own, if you wait that’s extra money on the price tag of the home.
Factor #2 – Rising Interest rates
It is predicted by economists that interest rates could increasing to as high as 5.5% next year. That could increase your house payment on a $300,000 home $320 a month. Of course that is not guaranteed, but that’s a significant jump on your house payment.
Not only that, but if you barely qualify for a $300,000 home today, rising interest rates will change the price you can afford on a home. With these higher interest rates, next year you’ll only qualify for a $255,000 home with the same payment. And by the way, that $255,000 home you could buy next year is on the market today for $240,000.
If you wait to buy a home until next year:
- the same house can cost you $320 extra each month (almost $4,000 a year)
- the home you could have purchased today could cost 5% more ($15,000 on a $300K home)
- the mortgage you can qualify for could be significantly reduced ($45,000)
Next year you will be getting less home for the same money!
Want to get the biggest bang for your buck? Find out how to buy a home today!