• Home
  • Property Search
  • About Me
  • Communities
  • News/Information
  • Contact
  • Request a Call
Welcome to Karen MelarkeyWelcome to Karen Melarkey
  • Home
  • Property Search
  • About Me
  • Communities
  • News/Information
  • Contact
  • Request a Call

Two Reasons Why Waiting To Buy a Home Will Cost You

Home NewsTwo Reasons Why Waiting To Buy a Home Will Cost You

Two Reasons Why Waiting To Buy a Home Will Cost You

Two Reasons Why Waiting To Buy a Home Will Cost You | Keeping Current Matters

If you’re a homeowner who’s decided your current house no longer fits your needs, or a renter with a strong desire to become a homeowner, you may be hoping that waiting until next year could mean better market conditions to purchase a home.

To determine whether you should buy now or wait another year, you can ask yourself two simple questions:

  1. Where will home prices be a year from now?
  2. Where will mortgage rates be a year from now?

Let’s shed some light on the answers to both of these questions.

Where Will Home Prices Be a Year from Now?

Three major housing industry entities are projecting ongoing home price appreciation in 2022. Here are their forecasts:

  • Fannie Mae: 7.4%
  • Freddie Mac: 7%
  • Mortgage Bankers Association: 5.1%

According to the National Association of Realtors (NAR), the median price of a home today is $353,900. Using an average of the three price projections above (6.5%), a home that sold for $353,900 today would be valued at $376,904 at the end of next year. As a prospective buyer, you would therefore pay an additional $23,004 by waiting.

Where Will Mortgage Rates Be a Year from Now?

Today, Freddie Mac announced their 30-year fixed mortgage rate was at 3.1%. However, most experts believe mortgage rates will rise as the economy recovers. Here are the forecasts for the fourth quarter of 2022 by the three major entities mentioned above:

  • Fannie Mae: 3.4%
  • Freddie Mac: 3.7%
  • Mortgage Bankers Association: 4%

That averages out to 3.7% if you include all three forecasts. Any increase in mortgage rates will increase your costs.

What Does It Mean for You if Home Values and Mortgage Rates Increase?

If both variables increase, you’ll pay a lot more in mortgage payments each month. Let’s assume you purchase a $353,900 home today with a 30-year fixed-rate loan at 3.1% (the current rate from Freddie Mac) after making a 10% down payment. According to mortgagecalculator.net, your monthly mortgage payment would be approximately $1,360 (this does not include insurance, taxes, and other fees because those vary by location).

That same home one year from now could cost $376,904, and the mortgage rate could be 3.7% (based on the industry forecasts mentioned above). Your monthly mortgage payment after putting down 10%, would be approximately $1,561.Two Reasons Why Waiting To Buy a Home Will Cost You | Keeping Current MattersThe difference in your monthly mortgage payment would be $201. That’s $2,412 more per year and $72,360 over the life of the loan.

Add to that the approximately $23,004 a house with a similar value would build in home equity this year due to home price appreciation, and the total net worth increase you could gain by buying this year is over $95,364 (the $72,360 mortgage savings plus the $23,004 potential gain in equity if you buy now).

Bottom Line

When asking if you should buy a home, you may think of the non-financial benefits of homeownership. When asking when to buy, the financial benefits make it clear that doing so now is much more advantageous than waiting until next year.

The post Two Reasons Why Waiting To Buy a Home Will Cost You appeared first on Keeping Current Matters.

0

You also might be interested in

10 Ways To Give Your House a Facelift Before Selling

Aug 18, 2021

When prepping your home to sell, it is important to make a great first impression. Check out these 10 cosmetic changes to give your house a facelift.

The post 10 Ways To Give Your House a Facelift Before Selling appeared first on Redfin | Real Estate Tips for Home Buying, Selling & More.

3 Graphs To Show This Isn’t a Housing Bubble

Aug 7, 2022

3 Graphs To Show This Isn’t a Housing Bubble | Keeping Current Matters
With all the headlines and buzz in the media, some consumers believe the market is in a housing bubble.

Why It’s Still a Sellers’ Market

Aug 7, 2022

Why It’s Still a Sellers’ Market | Keeping Current Matters
As there’s more and more talk about the real estate market cooling off from the peak frenzy it saw during the pandemic, you may be questioning what that means for your plans to sell your house.

Contact Us

We're currently offline. Send us an email and we'll get back to you, asap.

Send Message

My Pledge To You

I will help you negotiate – and also steer you through the closing process to make sure everything goes smoothly.

Karen Melarkey

  • LeMond Realty
  • 6490 S. McCarran Blvd, Bldg E, Reno Nevada 89509, Located in the Ribeiro Office Suites
  • 775-343-5901
  • karen@lemondrealty.com
  • karenmelarkey.com

Gavin Deller

  • 775-846-2239
  • gavin@lemondrealty.com

News/Information

  • A Window of Opportunity for Homebuyers
  • Want To Buy a Home? Now May Be the Time.
  • A Real Estate Professional Helps You Separate Fact from Fiction
  • Three Reasons To Buy a Home in Today’s Shifting Market [INFOGRAPHIC]

© 2022 · karenmelarkey.com

  • Home
  • FAQ
  • Contact
  • Request a Call
Prev Next