I see you…
I see you!
Happy Friday, Susie.
And it’s beautiful outside!
Which it is and it’s snowing pollen. Woohoo~.
My white car is now yellow. That’s that’s for sure.
My head hurts. But anyway, today we want to talk about the question that we get a lot lately from buyers. Which is, “Should I wait? Should I wait to buy because I don’t want to buy at the height of the market and I’m afraid of competing and maybe I should just wait this out.” What do we say, Bonnie?
Don’t do it. Just, just say no.
Why Bonnie? Why shouldn’t they wait?
Here’s the deal, everyone. We’re not fortune tellers and we don’t know what is going to happen with our economy in the future or with really anything. What we do know is the interest rates are incredibly low, historically low, and they went up and then they came back down. So just today they are…I will tell you exactly: the 15 year rate for a 15 year mortgage fixed mortgages is 2.375, which is bonkers low.
Of course, depending on your credit and all of that, we have to make that disclaimer. But as an average, that is ridiculous. It’s like practically free money truly…
Then for a 30 year, which is more common. Today is at 3.125. It was two days ago at three. And it’s really kind of just hanging around three, which is…
…And Just for perspective, last June, when I finally refinanced after waiting and waiting for the, the rate to be good enough for me to refinance, it was three and a half percent just last June. And I thought that was an amazing deal. And then it went down to below 3% and then it went back up to three and a half and I felt better. And now it’s back down to three and I feel bad again, but whatever it’s great for you, if you’re buying a new home!
What that means is if the interest rate goes up, let’s say 1 point. So let’s say, you know, it goes up to 4 you lose 9% purchasing power as a buyer. And 9% is a lot. If you’re spending 500,000 on a house, that’s a big chunk of money that you’re going to be able to mortgage versus not be able to mortgage. And for every, you know, $50,000, you’re getting a different type of house in this market.
You might get different benefits, different condition.
Maybe air conditioning, maybe an extra bedroom, things like that. They just continue to increase the amenities I guess you could call them as you go up in those price points.
Plus, the other thing that we’ve been telling our buyers is while we have no crystal ball, the prediction from those who are studying the market, including us, is that this isn’t going to change. It’s not going to shift down for the next year or two. And so if you want to move anytime in the near future, you really shouldn’t wait because the interest rates are likely to go up, which is, you know, the general prediction. And as we just talked about, that means you’re going to be able to afford less while the sale prices are still going to be high.
Right. And inventory is low nationally. Right now it is low because more people are buying houses. Then we’re expected to buy houses, including a lot of millennials who would normally be renting or living in the city are moving to the suburbs. So inventory is very low. That being said, there were several great homes last weekend in Soma that did not sell that did not even get an offer. And then some terrific houses that only got a couple offers. So if you’re a buyer and you’re saying, I don’t want to compete, I’m not going to deal with multiple bids. I’m never going to get a house. That simply is not true. We’re going to reiterate what we’ve been saying, which is you gotta be in it to win it.
Well, you know, reach out, let’s talk through what the plans are. And we can even talk about waiting to see what houses don’t sell and then jump in there. But you’ve got to be ready. You’ve got to have your ducks in a row. You have to know kind of what your parameters are for what you’re looking for.
And, and you have to be actively looking. You have to be in the game and you have to be ready to go. So we’re here to help you with that. We’re always looking at new inventory every week. And so when you talk to us and when you start working with us, whether it takes one week or one year, we will stick with you and just don’t give up and don’t be discouraged because of the market right now.
Definitely! On that note…
Bonnie & Susie (04:50):
Have a terrific beautiful weekend!
Yes, enjoy. Bye!