I've spent a few weeks talking about our current "Sellers' Market" and giving advice on how to make a home sell for top dollar. For those selling homes, this is an exciting time! For my friend Ronald, though, the Seller's Market makes him hesitant to look for a new home to buy.
Ronald confided in me that the increase in home prices made him worry he couldn't afford the same home today that he could have last year. "I feel like I should have bought a home last year instead of waiting! If buyers are competing and driving the prices up, won't I need to buy a smaller house just so I can afford the monthly payments?" he asked me. This is such a great question, and one I'm sure many buyers have. The good news is that the
historically low interest rates are working in our favor and you could pay LESS monthly on a higher mortgage amount because of it.
Here's how it works:
- According to CoreLogic, home values increased 6.7% over the last year.
- Interest rates are down 1.02pts from 3.75% average last November 2019 to 2.72% today (Freddie Mac Weekly Mortgage rate).
- Even with the cost of a home increasing, the impact of the lower interest rate
could save you money!
- Check out the table below.
Don't let the current market scare you; instead take advantage of the current interest rates. In fact, the home that cost
$600k last year with 3.75% interest would have had a total mortgage cost of $1,000,330 on a 30 year loan. The $640k home today with a 2.72% interest would have a total mortgage cost of $937,223! That's over $63k saved over 30 years with a lower monthly payment.
Buying a home is a smart investment. Is buying a home one of your 2021 goals? If so, call me or reply to this email. I'd love to talk to you about all the wonderful things that come with h
Warmly,
Arynne
PS: Not sure if you’re quite ready to buy your next home just yet? No problem. The sooner you start learning the ins and outs of this process, the better. Click here to book a real estate possibility call with me today.
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