What is the Cost of Waiting Until Next Year to Buy?
Article used with permission from Francis Phillips, First Choice Loan Services Inc.
What is the Cost of Waiting Until Next Year to Buy?
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’s most 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.
Francis Phillips
First Choice Loan Services Inc.
Senior Mortgage Loan Originator
NMLS 193642
(505) 982-3400
francis.phillips@fcloans.com
www.fcloans.com/fphillips
First Choice Loan Services Inc. (NMLS# 210764), a Berkshire Bank Company (NMLS# 506896), is located at One Tower Center, Floor #18, East Brunswick, NJ 08816. First Choice Loan Services Inc. is licensed, registered or exempt from state licensing in the states it originates mortgage loans. Licensed by the NJ Department of Banking and Insurance. AZ BK# 0918586. Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act. First Choice Loan Services Inc. is not an agency of the federal government and is not affiliated with your current lender. All loans are subject to credit approval. Programs, rates, terms and conditions are current, but are subject to change and may expire without notice. Other restrictions may apply. All applications must be submitted in writing. This advertisement is not a loan disclosure and all disclosures provided after applying should be reviewed carefully. This is not a commitment to provide a loan approval or a specific interest rate. Equal Housing Lender. 8.17.2017