Buy a house now or should I wait?

One of the things homebuyers are always asking themselves is buying now versus waiting. Mathematically it could pencil out that buying a house down the line might make more sense, but you should pay close attention to all the financial contributors in your life so you can make the most informed decision possible…

The lay of the land right now interest rates are at incredible all-time lows. Long-term fixed-rate mortgage money is in the mid-3% range and potentially could go even lower if you’re willing to pay discount points and have excellent credit. This is something that you should not overlook. The last time interest rates were at these levels was in 2012. Prior to that, there was no other time in US history where mortgage rates were at the levels that are presently at.

Additionally, purchasing the house now will afford you the ability to purchase something with very little competition. It depends on each house of course, but on average you might be going to get up against one or two other offers. In the summertime, you’ll have more choices, but the competition will be greater. We also don’t know what interest rates are going to be over the summer, but it’s been said that the average 30 years fixed-rate mortgage will remain sub 4% throughout the duration of 2020.

How you determine the best time to buy a house should have nothing to do with interest rates or competition or with availability or with scarcity on the market. Granted those are all important things, but the number one most important thing to be focused on is your finances. When you purchase a house the number one thing you should be focused on beyond anything else is that mortgage payment it, drives affordability. You want to pay close attention to the mortgage payment and your ability to save after your mortgage payment and other monthly obligations are already met. You need to be able to save money regardless of whether you buy a house or not. If that is in place and you’re feeling good about your job and you’re feeling optimistic about your finances and your income is stable to rising to pull the trigger. Here’s why- if you’re going to be buying a house and you have a long-term plan in place 5-7 years or longer even if this is not the perfect home the equity appreciation, and tax advantages weighed out over the course of time when compared to renting is significant.

If you’re thinking about buying a house and really need some direction talk to an experienced lender who can walk you through a budget if you don’t already have. Creating a budget and sticking to financial responsibility is the first step in pursuing a big high ticket item like homeownership.

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