Home prices increased fast with mortgage rates to follow so we get asked all the time – should I wait!?
Many are inclined to wait. However, playing the waiting game will likely cost you a lot later! According to a survey, more than 60 percent of U.S. renters would consider buying a home if their lease ended today. Here is why you should buy a home now vs. later.
MORTGAGE RATES ARE LIKELY TO FLUCTUATE THROUGHOUT 2023
Mortgage News Daily reported that the 30-year fixed-rate mortgage dropped by 0.30 percent (30 basis points). This was the largest one-day drop in more than a month and drove rates to their lowest levels since September. That happened for about two days and then they went back to where they were. Do NOT get caught in catching the right day, because it's like buying a stock that we didn't buy on the perfect day.
Mortgage rate predictions indicate that perhaps the worst is over. These rates hit their highest in October and November 2022, at 7%+. This was the highest rate in over 20 years. However, mortgage rates dropped to 5% in early February 2023 for about two days and then swung back up.
YOUR HOME VALUE WILL GROW
Buying now means you start building equity. Your down payment is your initial investment. Although it's hard to access, it is still yours and trends show it will most likely gain value faster than it would in any savings and/or investment account. When was the last time your money made 20%+ in one year?
Investing in a home builds your net worth, not your landlord's. You will make a housing payment whether you rent or buy your own home. Using these payments to build your wealth not your landlord's wealth. “Divorce the Rent!”
Rents are trending up! However, you can lock in your mortgage payments. This involves having an agreement with your lender that locks in the mortgage rate for a specific period. The mortgage rate lock will protect you from rising interest rates during the lock period.
LENDERS AND SELLERS ARE OFFERING BETTER OPTIONS TO HOMEBUYERS
Another reason to buy a home in 2023 is that buyers can negotiate better deals. Many sellers are giving concessions to buyers, including mortgage rate buydowns, money for repairs, and closing costs. Sellers do not have the same leverage they did 6 months ago and are listing at more reasonable prices and even making concessions for buyers. Also homes are now sitting on the market for longer than we've been used to and don't be surprised to see price reductions, which is wonderful to see again for the buyers.
Evergreen Home Loans has launched better financing options to help home buyers meet their goals. Besides us fully underwriting a file so a buyer can waive their financing which is huge for all parties, and we back it with $5,000 to boot. We also have an all-CASH product and bridging. And for our Sellers, we have Lock-n-List, a program that locks a rate after a homeowner lists their property with a float down. With the rates moving constantly, having a lock on your listing may make your home more appealing to a buyer. No obligation, just another way to get eyes on your home to sell.
Our Buyer Booster Program is another way lenders are helping buyers in this market! We say the rate now is your acquisition loan with a plan to refinance once we see rates come down. Hence, this program boosts your refinancing power by giving you a $2,500 credit, which you can use by end of March 2026. Pretty certain everyone buying today will be refinancing before 2026!
FINAL WORDS
Although mortgage rates are up, they should not discourage you from owning your home. We all need shelter and investing in a home will take care of you now and later. If you do not know where to start – reach out! Do not be scared or feel you need to understand this process because that is your lenders' job. If you don't know the questions to ask – that's okay too.
