Should I Buy a Home Now or Wait for Interest Rates to Drop?!?
Conversation continued: For those of you sitting on a bunch equity in your current homes that would really like to move, take that money out and push yourself to buy a bigger, or more expensive home. The question I have for you is would you rather gain the appreciation on a $400k house or an $800k house?
Everything I hear is rates will come down, likely mid next year. When that happens, home values and demand will blow up again, and likely bigger than the last boom! I’m seeing 5-10% discounts on deals today as sellers are softening their stance on value. I’m negotiating some pretty nice deals for my buyer clients in this market which would’ve been unheard of from 2020-2022.
Let’s look at it from a different angle: Take that $400k home and let’s look at the interest difference between a 7.5% and 5.5% rate. It’s a monthly difference of $525. If I get a 10% discount or $40k in this softer high interest rate market today, it would take ~6.3 years – that’s right folks – 6.3 years for the interest saved waiting for these rates to drop to equal the savings in price/value in a softer market. I have a feeling rates will come down over the next 6.3 years, don’t you? You get one chance at sales price!
Not to mention that most lenders are offering free refinances down the road if you buy today,or temporary rate buy downs. This is the time to buy. So go ahead and buy your bigger or more expensive home now, or jump off the ledge and become a homeowner instead of renting! Move into that neighborhood you always wanted to get into. Don’t be like most uninformed buyers/homeowners and wait until the next boom. Trust the math.
So the answer to the question “should I buy a home now, or wait for rates to drop?” is a resounding BUY NOW. Be bold and trust me on this. This is step 1 of generating wealth. Hit me up and lets chat about it. I hope this helps and changes your life and perspective!
Thanks Holly Vejrostek, Jeremy Larkin and Patrick Conway!