These are both very reasonable things to say. It makes one think that this person is really giving it some thought, right? Well that is what I used to think. Now I have started to see it as nothing more than a simple excuse. A reason that makes it okay for them not to act and get what it is they self-admittedly want. If we look at real estate historically, prices of property going down for no reason at all just doesn’t happen.
In fact, just the opposite, they have gone up drastically since the beginning of time. So we have no real basis for thinking, prices will correct and go back down at some point. Secondly, rates fluctuate. They go up, come back down and eventually go up again. They have been much higher than they are right now, they have been lower than they are right now and they will continue to change over time based on many economic factors.
The beauty of the interest rate is that it can change. So while your hanging on the sidelines, watching rent prices increase at unprecedented rates, paying someone else’s mortgage for them, you’re likely just setting yourself up to pay a much higher sticker price for that dream home you’ve been waiting to act on. With one thing we know for sure being that you cannot change your cost of acquisition, consumers need to look at their current financial situation, as long as it is stable and make the determination in this very moment with their current lifestyle and current bills on whether they can afford it.
If the answer is yes, go for it! If it is no, don’t! Then if the rate goes up, you look like a genius for locking it in before it went up. If they go down, then you can refinance and save yourself some money but you already know you can afford that monthly payment based on the higher interest rate. If everyone follows this simple rule, we should see an increase in new homeowners in 2023.