Good News: Increases in home prices and historically low interest rates means you can be a home buyer now!
I recently shared that national home prices have increased by 6.7% year-over-year. Over that same time period, interest rates have remained historically low. This has allowed many buyers to enter the market. This is good news!
As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.
The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Index Report, home prices will appreciate by 5.2% over the next 12 months.
What Does This Mean for you, the Buyer?
If home prices rise by 5.2% over the next twelve months, as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:
Bottom Line
If buying a home is in your plan for this year, doing it sooner rather than later could save you thousands of dollars over the terms of your loan. Amazing how that difference in monthly payment adds up over the years.
Contact me. I am happy to discuss your situation today!
