We compared the numbers on buying a home now against waiting two years.
I just talked with a lender friend of mine about the benefits of buying now over waiting. We looked at the national numbers and compared buying a $500,000 house now against waiting two years to buy.
The forecasts predict that next year we’ll see the appreciation drop to 12% and then to 5% the year after that. By those numbers, the $500,000 home will cost $590,000 in two years. Interest rates are fantastic right now at 2.9%, but we can’t expect that to last, so they will be higher after two years; we’re predicting those rates would be around 4%.
There is just no indication that prices will go down over the next two years.
If you buy now, your monthly payment would only be $2,695. If you buy next year, that rises to $3,201. The year after that it’s $3,491 every month. Your cash to close, which includes your down payment and closing costs, would go from around $38,000 to $44,000 after two years.
If you wait two years, you’d be paying at least $800 more every month. So if you’re a buyer who’s on the fence, now is your best time. There is just no indication that prices will go down over the next two years.
If you have any questions about these numbers or other real estate topics, feel free to give me a call. I’d love to hear from you, and I can even put you in touch with a great lender if you’re looking to know more.