What is the Cost of Waiting Until Next Year to Buy?

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    We recently shared that over the course of the last 12 months, home prices have appreciated by 7.0%. Over the same amount of time, interest rates have remained historically low which has allowed many buyers to enter the market.

    As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.

    The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’smost recent Home Price Index Report, home prices will appreciate by 4.7% over the next 12 months.

    What Does This Mean as a Buyer?

    If home prices appreciate by 4.7% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:

    Bottom Line

    If buying a home is in your plan for 2018, doing it sooner rather than later could save you thousands of dollars over the terms of your loan.

    All information found in this blog post is deemed reliable but not guaranteed. Real estate listing data is provided by the listing agent of the property and is not controlled by the owner or developer of this website. Any information found here should be cross referenced with the local county and state organizations.

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