This is follow-up to a previous post. I’ve read and heard comments that buyers are afraid to purchase a home because they are afraid that they will miss a better deal. This is simply not a good strategy. Buying a home is not like waiting to buy a TV on Black Friday. There are too many variables beyond your control. In fact, even if you get a better price by waiting, you may get a worse deal.
Consider this scenario,
Last week, a property came onto the MLS for $160,000 that a buyer was interested in. If the buyer had made a reasonable offer (97% is reasonable in Louisville), he or she could have possibly purchased the home for $155,200. At the time, average interest rates were 5.82% according to Bankrate. Monthly Principal and Interest payments for this purchase would be $912.62. However, if the buyer had waited until this week, the 30-year average rate rose to 6.08% and the payment is now $938.50! To get back to $912.62, the buyer would have to get the house for approximately $150,900! This is far more unlikely.
So, now what? Should you wait and see what happens next week? The answer is a resounding NO. According to this week’s survey of 250 experts by mortgage-x.com, 37.9% believe rates will increase slightly and 41.4% believe they will fall slightly over the next 30 days. A virtual coin-flip. Stop denying yourself a home that you want out of fear of missing a better deal! If you find a home, purchase it and start earning equity. This is something that you can control!
If you are looking for a home in Louisville, Shepherdsville, or anywhere else in the Metro Area...
I am here to help
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