Buying Your First Home? Why Waiting May Not Be A Good Idea

The Cost of Waiting to Purchase = The Additional Monies Needed to Purchase Given Increases in Prices and Interest Rates

What are economists predicting for the upcoming year?  And what does that mean in terms of the Cost of Waiting? Let's use an example to illustrate. 

Let’s say you’re in your early thirties and your dream house costs $225,000 today, and you make a $25,000 downpayment. Right now mortgage interest rates are around 4%. Your monthly mortgage payment (principal & interest) would be $954.83.

What if you decide not to buy now, but wait until next year to buy?  

Home prices are predicted to appreciate by 5.1% in the next 12 months, which would mean that same house now costs $236,475, and interest rates are predicted to be a full point higher at 5% within 12 months.  Your monthly payment with the same $25,000 downpayment would be $1,135.24.

The difference in payment is $180.41 per month. That’s $2,164.92 per year.  You could lease a car for that . . . or take an extra vacation . . . I'm sure you can think of a lot of things you could do with an extra $2,164.92 every single year.

Over the course of your 30 year loan you would have spent an additional $64,949.99.

Thirty years from now when you are in your 60's and kicking back . . . would you be glad you didn't wait a year?  There's a good chance of that!

For expert guidance when purchasing your first home, count on our team of experts.  Contact us any time.  We know how important this purchase is to you, and we will help you make the best possible decision.  

Use our Home Financing Calculators to see how your mortgage costs will compute.