Got Fear Of Paying Too Much?
Tuesday Mar 01st, 2022
If you're thinking about buying a home, chances are you're worried about paying too much. Who can blame you? Prices have been skyrocketing. You have to wonder if those prices are sustainable and what your home will be worth in ten years. If you're worried, here are some thoughts that might help you make a decision.
1. No one knows what home prices will be in ten years. Don't assume prices will fall or rise. Make calculations based on today's facts, not on a guess about the future. How long are you willing to wait for the chance of a price drop?
2. Figure 28% of your current gross monthly income. That's how much you should budget for your payment. If you can afford a house you want today based on that monthly payment, then you're in good shape to buy. A good loan broker can tell you what home price that will buy, based on your interest rate and down payment (plus the down payment money you have). Let me know if you need a lender referral.
3. The longer you'll be in the home, the less difference a higher price now will make. Even if prices fall over the next 10 years, that's still 10 years of value you've gotten from your home, both in lifestyle and equity.
4. If you can't buy a house you want in today's market, then you may need to save more down payment or wait until your income rises. ● If property prices come down while you're saving, you'll be in great shape to buy. ● If prices stay flat, you'll be in the same position you were before, but with more money saved. ● If prices rise further, you'll hopefully be in better shape financially and likely able to afford the higher monthly payment.
If you've been putting off buying -- but you want to buy -- call for a consultation. 461-294-0795
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