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The offset- Waiting to buy a home
There’s always a lot of misinformation in real estate. I don’t necessarily feel that it’s malice or intentional. I just feel that many times when I read these articles in the newspaper the person writing doesn’t really have a perspective of what residential real estate is let alone what’s going on currently in the market.
As I write in this article several different web-based mortgage calculators are currently using 6.214% interest rate for a 30-year fixed mortgage. This is the rub right now because everybody fears rates. Understandably so because it’s one of those things where common-sense dictates that the lower the interest rate, the lower the house payment.
As we work through the remainder of 2025 into 2026, interest rates should continue to drop as the Fed continues to cut their rate making the dollar more appealing. When the dollar becomes more appealing, more countries invest in our US bonds which is what drives the interest rates for home loans.
In the meantime, there’s one other thing I would like to point out that a lot of people seem to be overlooking. I’ve included a chart with this article to give you reference. Essentially what I’d like you to consider is this- if you purchased a home today at $400,000 with a 6 1/2% interest rate which is what it’s been up until as of recent. You’re putting down 3% your payment would be roughly 2931 dollars. If you wait for the rate to drop to 5.75%. Hoping that that happens in early 2026 or sometime during the year, with average appreciation that $400,000 house could very well go back on the market $428,000 in the spring market.
If that happens with a lower interest rate, putting the same amount of money down but with the higher sale price. You end up having the same payment roughly of 2931 dollars. Lesson to this story is rather than just pay attention to what I have to say or anybody in the newspaper or media, take a look do it for yourself and find out what the facts are. You might be in a better position right now to purchase than you will be if we end up with multiple offers.
This is not a scare tactic and it’s certainly nothing that I can prove. But I’ve been a licensed real estate agent for over 23 years, and I’ve seen all different types of markets. It only stands to reason from a commonsense standpoint that interest rates drop which is what a lot of home buyers are waiting for. They will all jump back into the market at the same time. With a limited number of properties even though we have more for sale right now than we did three years ago, it’s very conceivable that the good ones will end up in a bidding war period so it’s very possible you could pay anywhere from $5000 all the way up to $50,000 over the list price depending on how it was priced to start with, location and how many buyers you have in that area looking for the same type of home.
All I’m saying is here’s some information for you to read and consider. That’s it, the more you know the better options you have which will lead you to better decisions. There are varying factors and degrees to all of this. Give me a call today and let’s have a conversation. I can connect you with a loan officer that I trust to answer your questions.
