Buy NOW or WAIT?
Updated: Feb 2, 2022
The question I’ve gotten constantly over the past two years is, should I buy now or wait?
There seems to be a lot of uncertainty regarding doing the right thing to protect your financial interests.
According to an article in Forbes from July 27, 2021, Bill Conerly writes “The current housing boom will flatten in 2022—or possibly early 2023—when mortgage interest rates rise. There is no bubble to burst, though prices may retreat from panic-buying highs.”
I happen to agree with him. Truthfully, you can research and find someone who agrees with your side of the story as well. I believe what you should do is directly related to your specific situation.
If you have cash to buy what you need or want, then you may be best to wait for values to level out and the average appreciation to steady to a normal 5-10% per year.
The change in the interest rates that are looming, will not affect you. You can afford to wait it out. Just know that you will wait what could be 2 years, possibly more.
If you are buying with a mortgage loan, like so many are, then waiting may not be your best option.
As you may know, you’ll pay the major part of your mortgage interest in the first 10 years of buying the home. Your interest is calculated daily on the total amount due.
Please research amortization rate schedules— and you can see that waiting for lower prices is going to cost you approximately 100K more in interest!
I have provided a few graphics to help show the differences.
Right now, interest rates remain low.
This makes even the higher prices more affordable than you would have expected in the long run. You have time to buy and take advantage of this market.
If you have credit issues, please talk to a local lender who can advise you how to improve them.
In 6 months, with the right advice, you can probably turn things around and be someone who has a historically low interest rate for the next 30 years!