Let’s look at an example of what the experts are predicting for the upcoming year, and what that really would mean for you. Let’s say you’re 30 and your dream house costs $250,000 today. Right now mortgage interest rates are at or about 4%.
Your monthly mortgage payment (principal & interest only) would be $1,193.54.
But you’re busy and moving is such a hassle. You decide to wait until next year to buy. CoreLogic predicts that home prices will appreciate by 5.1% in the next 12 months, which would mean your dream home now cost $262,750.
Freddie Mac predicts that over this same period of time, interest rates will be a full point higher at 5.0%. Your new payment per month would now be $1,410.50.
The difference in payment is a whopping $216.96 PER MONTH!
That’s basically like taking $8 and tossing it out the window EVERY DAY!
Let’s look at that number annually. Over the course of your new mortgage at 5.0%, your annual additional cost would be $2,603.52!
Over the course of a 30 year loan, your home would cost an additional $78,105.60. That is not small potatoes. What could you do with $78,000 and change?
Now that you know what the cost of waiting a year to buy is, what do you think? Is it time for you to buy? Please call Josh Mettle at 801-747-1210 to see if it makes sense for your situation to buy now. Or click the chat button above to reach us. We’d love to hear from you. What is stopping you from buying a home now?
Thanks to KCM blog for this post.