Should You Wait For Interests Rates to Go Down to Buy?

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topic of conversation that I have with a lot of my clients right now, and it’s a valid one, is “should you wait to buy until interest rates go down and continue to just rent? ” And while buying is not for everyone. I do feel like there are a couple of points that people definitely miss when they’re considering this.

 
Number one is simply do the math. If you are renting right now in today’s market, let’s just say that you’re renting for $2,000 a month. If you waited for 12 months to buy, it’s $24,000. If you wait two years in the idea that interest rates are going to go down, that’s $48,000 that you have spent over that period of time in rent.
 
Number two, and this is a big one that I feel like people definitely don’t take into consideration, is the cost of waiting. It’s lost appreciation. If you purchased a property today at the end of one year or two years, how much has that home appreciated in value that you will not get if you’re continuing to rent?
 
Number three is your financial benefit. If you’re renting, you get no financial benefit or break whatsoever. Whereas, if you’re buying a property, you will be able to write off your mortgage interest at the end of the year, which is a huge benefit.
 
Lastly, there is the myth that you are going to need a large down payment that I think holds a lot of people back from buying. There’s this misconception that you’re going to need 20% as a down payment, when in reality most of the products that we have, have such low down payment, even some of them have 100% financing. I just feel like that you need to have all of the information at your disposal before you make a decision about renting versus buying.
 

A big one that I feel like people definitely don’t take into consideration, is the cost of waiting. It’s lost appreciation.

Bethany Ashby

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