{"id":7471,"date":"2021-12-09T06:00:10","date_gmt":"2021-12-09T11:00:10","guid":{"rendered":"https:\/\/blog.sfloridaluxuryhomes.com\/?p=7471"},"modified":"2021-12-09T06:00:10","modified_gmt":"2021-12-09T11:00:10","slug":"two-reasons-why-waiting-to-buy-a-home-will-cost-you","status":"publish","type":"post","link":"https:\/\/blog.sfloridaluxuryhomes.com\/?p=7471","title":{"rendered":"Two Reasons Why Waiting To Buy a Home Will Cost You"},"content":{"rendered":"<div>\n<p><img decoding=\"async\" width=\"358\" src=\"https:\/\/blog.sfloridaluxuryhomes.com\/wp-content\/uploads\/2021\/12\/20211209-KCM-Share-549x300-1.jpg\" class=\"webfeedsFeaturedVisual wp-post-image\" alt=\"Two Reasons Why Waiting To Buy a Home Will Cost You | Simplifying The Market\" loading=\"lazy\" style=\"display: block; margin-bottom: 5px; clear:both;max-width: 100%;\" link_thumbnail=\"\" srcset=\"https:\/\/blog.sfloridaluxuryhomes.com\/wp-content\/uploads\/2021\/12\/20211209-KCM-Share-549x300-1.jpg 549w, https:\/\/files.simplifyingthemarket.com\/wp-content\/uploads\/2021\/12\/08132109\/20211209-KCM-Share.jpg 750w\" sizes=\"auto, (max-width: 549px) 100vw, 549px\"><\/p>\n<p>If you\u2019re a homeowner who\u2019s decided your current house no longer fits your needs, or a renter with a strong desire to become a homeowner, you may be hoping that waiting until next year could mean better market conditions to purchase a home.<span id=\"more-45625\"><\/span><\/p>\n<p>To determine whether you should buy now or wait another year, you can ask yourself two simple questions:<\/p>\n<ol>\n<li><strong>Where will home prices be a year from now?<\/strong><\/li>\n<li><strong>Where will mortgage rates be a year from now?<\/strong><\/li>\n<\/ol>\n<p>Let\u2019s shed some light on the answers to both of these questions.<\/p>\n<h4><strong>Where Will Home Prices Be a Year from Now?<\/strong><\/h4>\n<p>Three major housing industry entities are projecting ongoing home price appreciation in 2022. Here are their forecasts:<\/p>\n<ul>\n<li><a href=\"https:\/\/www.fanniemae.com\/research-and-insights\/forecast\"><em>Fannie Mae<\/em><\/a>: 7.4%<\/li>\n<li><a href=\"http:\/\/www.freddiemac.com\/research\/forecast\/20210715_quarterly_economic_forecast.page?\"><em>Freddie Mac<\/em><\/a>: 7%<\/li>\n<li><a href=\"https:\/\/www.mba.org\/news-research-and-resources\/research-and-economics\/forecasts-and-commentary\"><em>Mortgage Bankers Association<\/em><\/a>: 5.2%<\/li>\n<\/ul>\n<p>According to the <em>National Association of Realtors <\/em>(NAR), the median price of a home today is <a href=\"https:\/\/www.nar.realtor\/research-and-statistics\">$353,900<\/a>. Using an average of the three price projections above (6.53%), a home that sold for $353,900 today would be valued at $377,010 at the end of next year. As a prospective buyer, you would therefore pay an additional $23,110 by waiting.<\/p>\n<h4><strong>Where Will Mortgage Rates Be a Year from Now?<\/strong><\/h4>\n<p>Today, <em>Freddie Mac<\/em> <a href=\"http:\/\/www.freddiemac.com\/research\/forecast\/20210414_quarterly_economic_forecast.page?\">estimates<\/a> the average 30-year fixed mortgage rate in the fourth quarter of this year will be 2.8%. However, most experts believe mortgage rates will rise as the economy recovers. Here are the forecasts for the fourth quarter of 2022 by the three major entities mentioned above:<\/p>\n<ul>\n<li><a href=\"https:\/\/www.fanniemae.com\/research-and-insights\/forecast\"><em>Fannie Mae<\/em><\/a>: 3.4%<\/li>\n<li><a href=\"http:\/\/www.freddiemac.com\/research\/forecast\/20210715_quarterly_economic_forecast.page?%22%20%EF%BF%BDHYPERLINK%20%22http:\/\/www.freddiemac.com\/research\/forecast\/20210414_quarterly_economic_forecast.page?\"><em>Freddie Mac<\/em><\/a>: 3.8%<\/li>\n<li><a href=\"https:\/\/www.mba.org\/news-research-and-resources\/research-and-economics\/forecasts-and-commentary\"><em>Mortgage Bankers Association<\/em><\/a>: 4%<\/li>\n<\/ul>\n<p>That averages out to 3.73% if you include all three forecasts. Any increase in mortgage rates will increase your costs.<\/p>\n<h4><strong>What Does It Mean for You if Home Values and Mortgage Rates Increase?<\/strong><\/h4>\n<p>If both variables increase, you\u2019ll pay a lot more in mortgage payments each month. Let\u2019s assume you purchase a $353,900 home in the fourth quarter of this year with a 30-year fixed-rate loan at 2.8% after making a 10% down payment. According to <a href=\"https:\/\/www.mortgagecalculator.net\/\"><em>mortgagecalculator.net<\/em><\/a>, your monthly mortgage payment would be approximately $1,309 (this does not include insurance, taxes, and other fees because those vary by location).<\/p>\n<p>That same home one year from now could cost $377,010, and the mortgage rate could be 3.73% (based on the industry forecasts mentioned above). Your monthly mortgage payment after putting down 10%, would be approximately $1,568.<a href=\"https:\/\/blog.sfloridaluxuryhomes.com\/wp-content\/uploads\/2021\/12\/20211209-MEM-Eng-1.png\" data-rel=\"lightbox-image-0\" data-rl_title=\"\" data-rl_caption=\"\" title=\"\"><img decoding=\"async\" loading=\"lazy\" class=\"aligncenter wp-image-45627\" src=\"https:\/\/blog.sfloridaluxuryhomes.com\/wp-content\/uploads\/2021\/12\/20211209-MEM-Eng-1.png\" alt=\"Two Reasons Why Waiting To Buy a Home Will Cost You | Simplifying The Market\" width=\"650\" height=\"488\" srcset=\"https:\/\/blog.sfloridaluxuryhomes.com\/wp-content\/uploads\/2021\/12\/20211209-MEM-Eng-1.png 1000w, https:\/\/files.simplifyingthemarket.com\/wp-content\/uploads\/2021\/12\/08132110\/20211209-MEM-Eng-1-400x300.png 400w\" sizes=\"auto, (max-width: 650px) 100vw, 650px\"><\/a><strong>The difference in your monthly mortgage payment would be $259. That\u2019s $3,108 more per year and $93,240 over the life of the loan.<\/strong><\/p>\n<p>Add to that the approximately $23,110 a house with a similar value would build in home equity this year due to home price appreciation, and the total net worth increase you could gain by buying this year is over $115,000 <em>(the $93,240 mortgage savings plus the $23,110 potential gain in equity if you buy now)<\/em>.<\/p>\n<h3><strong>Bottom Line<\/strong><\/h3>\n<p>When asking <em>if you should buy a home<\/em>, you may think of the <a href=\"https:\/\/www.simplifyingthemarket.com\/2021\/05\/03\/americans-find-the-nonfinancial-benefits-of-homeownership-most-valuable\/?a=616460-ab6caa3a6a8f085fc17c865a33a506b4\">non-financial benefits<\/a> of homeownership. When asking <em>when to buy<\/em>, the financial benefits make it clear that doing so now is much more advantageous than waiting until next year.<\/p>\n<p>Content previously posted on Keeping Current Matters<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<div><img decoding=\"async\" width=\"358\" src=\"https:\/\/files.simplifyingthemarket.com\/wp-content\/uploads\/2021\/12\/08132109\/20211209-KCM-Share-549x300.jpg\" class=\"webfeedsFeaturedVisual wp-post-image\" alt=\"Two Reasons Why Waiting To Buy a Home Will Cost You | Simplifying The Market\" loading=\"lazy\" style=\"display: block;margin-bottom: 5px;clear:both;max-width: 100%\">If you\u2019re a homeowner who\u2019s decided your current house no longer fits your needs, or a renter with a strong desire to become a homeowner, you may be hoping that waiting until next year could mean better market conditions to purchase a home. To determine whether you should buy now or wait another year, you [\u2026]<\/div>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"bgseo_title":"","bgseo_description":"","bgseo_robots_index":"","bgseo_robots_follow":"","footnotes":""},"categories":[3,134,88,84,118,89,121],"tags":[],"class_list":["post-7471","post","type-post","status-publish","format-standard","hentry","category-blog","category-buying-myths","category-first-time-home-buyers","category-for-buyers","category-interest-rates","category-move-up-buyers","category-pricing"],"_links":{"self":[{"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/posts\/7471","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7471"}],"version-history":[{"count":0,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=\/wp\/v2\/posts\/7471\/revisions"}],"wp:attachment":[{"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7471"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7471"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.sfloridaluxuryhomes.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7471"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}