March 28, 2018
By Rick Schlager, Area Manager/Senior Mortgage Loan Officer
Purchasing Power – How sitting on the fence in a raising rate market can hurt you.
Buying a house is a big decision. Often it is the largest purchase you will make in your life. But when is the best time to buy? That is a tricky question that can often be influenced by internal factors (your current situation or personal motivation) and external factors (rates or type or market.) Consider the following graph:
From a buyer’s standpoint, a 1% increase in interest rate can lose you $40,000 on the purchase price. That could be another bedroom, a new kitchen or a swimming pool.
From a seller’s view waiting to list to get the best price you can, with rates raising they potentially reduce the pool of borrowers able to afford their home.
Why wait? Carpe Diem!