How And Why It Makes Sense To Buy A Home In Today's Market
Are you kicking yourself for not buying a home a couple of years ago? Feeling like you missed out due to the increase in interest rates? I am here to help you make sense of purchasing your next home even with the higher interest rates.
The lower interest rates of the past not only came along with limited inventory, you also found yourself competing with hedge funds more times than not. This means that in order to have a desirable offer, you would need to pay 100% of your closing costs and waive all contingencies including home inspections, sale of current home and appraisal.
With the 3.5% interest rate, so many people were chasing homes and submitting offers well over asking price/appraised value. This put a lot of people at risk of having to pay the difference of what their offer was and what the home appraised for (AKA: Appraisal Gap) in addition to 100% closing costs and any repairs needed due to waive of inspection.
With the current 7-8% interest rates, not as many people are buying which means sellers are more likely to either cover or split closing costs and allow contingencies and appraisal.
So, on paper a 3.5% interest rate may sound more appealing but what baggage does that come with? Interest rates may be higher, however, this not only makes the home buying process a lot less stressful due to there no longer being the sense of urgency there once was, it also will save you a lot on the front end.
If you need more information give us a call at 615-243-6805