The cost of waiting for mortgage rates to go down, each person’s situation is unique
Mortgage rates have increased significantly in recent weeks. And that may mean you have questions about how this impacts you if you’re planning to buy a home. Here’s some information that can help you make an informed decision when you set your home buying plans.
As mortgage rates rise, they impact your purchasing power by raising the cost of buying a home and limiting how much you can comfortably afford. The amount you can afford to borrow decreases and that may mean you have to look at homes at a different price point. That’s why it’s important to work with a real estate advisor to understand how mortgage rates impact your monthly mortgage payment at various home loan amounts.
The rise in mortgage rates and the resulting decrease in purchasing power may leave you wondering if you should wait for rates to go down before making your purchase. The truth is, you may be waiting for a while as the Federal Reserve works to get inflation under control. Please remember though, that these interest rate changes have pushed home prices down, and that’s great for the buyer.
And if you’re considering renting as your alternative while you wait it out, remember that’s going to get more expensive with time too. As Nadia Evangelou, Senior Economist and Director of Forecasting at the National Association of Realtors (NAR), says:
“There is no doubt that these higher rates hurt housing affordability. Nevertheless, apart from borrowing costs, rents additionally rose at their highest pace in nearly four decades.”
Basically, it is true that it costs more to buy a home today than it did last year, but the same is also true for renting. This means, either way, you’re going to be paying more. The difference is, with homeownership, you’re also gaining equity over time which will help grow your net worth. The question now becomes: what makes more sense for you?
Each person’s situation is unique. To see how your purchasing power has been impacted and to make the best decision for you, let’s connect to explore your options and find the solution that works best for you.
Let’s connect so I can help you strategize to achieve your dream of homeownership this season.
Questions about buying or selling a home in Beaverton? Contact Donna Meeuwsen at 503.583.3200 or email email@example.com