Should You Wait for Mortgage Rates to Drop? 6 Reasons to Buy a Home Now
The Federal Reserve cut interest rates by half a point earlier this week, which resulted in the lowest mortgage rates we've seen since early February 2023. And with the promise of more cuts in the next few months, you may be wondering if you should wait for even lower rates before buying home. The truth is, this strategy could have some unintended consequences. Here are six reasons why it might be better to buy now before prices and competition rise.
1 - Stiff Competition
As rates drop and more buyers enter the market, there's likely to be increased competition and a higher likelihood of the return of bidding wars.
2 - Rising Home Prices
With higher demand, home prices will also likely rise, which will decrease your buying power.
3 - Paying More for Less
Waiting for the perfect rate might cost you more in the long run. You could ultimately end up paying more money for less house, which may leave you having to compromise on important details in your new home.
4 - Big Drops Aren't Likely
While mortgage rates are expected to continue trending downward, most experts agree that we aren't likely to see the historically low rates that were available immediately post-pandemic.
5 - You Can Refinance Later
Remember, mortgage rates aren't permanent! So if you do see rates drop to a level you're more comfortable with, you can always refinance down the road to secure that lower monthly payment.
6 - Get the Best of Both Worlds
Why wait? Secure the home that fits your lifestyle and enjoy it now, knowing that you can adjust your rate later. (You can check out some recent listings here.)
If you've been thinking of buying in the next few years, you owe it to yourself to talk to a knowledgeable lender and real estate broker who can help you map out the best plan for your current life and your long-term goals. Reach out to us anytime to discuss the Portland market or for a mortgage lender referral!
