Buy Now vs. Buy Later

(Barbara) So it’s the fall season, the kids are back to school, and traditionally in real estate, it’s the time of year where the market starts to soften up a little bit. There’s fewer Buyers out and there’s traditionally a little bit more inventory.

 

What I am hearing from Buyers right now is a couple things: because there isn’t the mad frenzy and multiple offers right now, they think suddenly that the market’s just going to crash, and they think that if they wait until next year, that there will be more inventory. And certainly what I’ve been reading is the feds are signaling some higher interest rates coming down the pipes. What are you hearing, Maureen?

 

(Maureen) From my clients, from Buyers coming through open houses, I’m often at an open house and clients have the same concerns: They’re wondering, “Should I just wait? Should I buy now?” But with the feds signaling those 2 more rate heights possibly by the end of this year, what if that puts you in a worse position? Because honestly I don’t see us having a giant correction, we’re not gonna have a giant crash like we saw before. I’m not an economist, I don’t have a crystal ball, but with that said, what if you called your Lender, whoever you are working with, and asked them to do a hypothetical scenario for you where you are right now, with the FICO score you have, the down payment that you have, and the purchase price ranges where they are, and today’s rate. And then do the same thing for hypothetically say in February/March, what if the rate were increased and there were a slight decrease in the sales price, how does that payment differ? Are you really saving anything? Because if you wait and you’ve got that higher rate, you’ve got that higher interest for remainder of that 30 years. There’s a lot to think about, everybody’s scenario is different. So definitely check again with whoever you’re working with so that you can see what works best for you.

 

(Barbara) A lot of times, even with a higher purchase price, with this lower interest rate, it’s better for you in the long run. Besides, it’s your money. So definitely work with you Lender on that, and it makes your REALTOR’s job a whole lot easier.