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There Can Be a Cost By Waiting to Purchase

Posted by Veronica On May - 24 - 2013

Rise in Prices of Homes In many instances, prospective buyers believe that the longer they wait to purchase a home or property, the better off they are, but the opposite is actually usually true. The reason for this is because instead of home prices and interest rates going down, in these tough economic times, they end up usually going up. Home prices rose in 41 states and D.C. in the 1st quarter of 2013. Many prospective home buyers are finding themselves in quit a predicament simply because they chose to wait on their purchase. It seems like more often than not, interest rates are going higher and higher and this is very bad for prospective home buyers because they end up spending much more money in the long run. Obviously, when a home price goes up, the prospective buyer will have to pay more for the home initially, but if the interest rate goes up, which it often does, the prospective home buyer will need to pay the higher interest rate and then some. The interest rate can impact the prospective home buyer for years to come since the actual rate of the home increases just because the interest rate increases. For instance, if the term is 30 years and the total monthly payment is $1,500, then just a small increase can raise the home price significantly. If the home price is at a certain point, then if the interest rate increases, they will not be able to purchase the same home since the price of the home will have raised and they would not be accepted into that category. So, as you can see, waiting on a home purchase can not only cause the prospective home buyer to pay out more money initially, but it can impact their opportunity of getting their dream home overall. The best bet for any prospective home buyer is to purchase as soon as possible before the price of the home, or worse, before the interest rate increases.

About the Author

As a broker specializing in multi-units and single family homes in Southern Maine, Veronica Schneider joined the real estate industry in August of 2004 bringing with her over eight years of experience in real estate management. You can find Veronica and Green Tree Realty on Facebook, Twitter, Google+, Pinterest, and LinkedIn.

One Response to “There Can Be a Cost By Waiting to Purchase”

  1. Rick Airey says:

    Great article. Being in the mortgage industry I find myself having this conversation with my customers. What’s more, we now find ourselves in an environment of rising interest rates, which lowers a buyer’s potential purchase power even further. I know buyers have been hearing this for years and it’s like the boy who cried wolf, but NOW truly is the time to buy…. before prices and interest rates go any higher.

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As a Portland Maine real estate agency Green Tree Realty specializes in Residential and Investment real estate for southern Maine buyers, sellers and investors looking in the Androscoggin, Cumberland and York counties residential and investment markets.

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