submitted by Lynne Kelleher, Berkshire Hathaway Home Services/Fox Roach Realtors Newtown Office
If you’re considering a move, whether it’s into your first home or a larger one, waiting to do so could end up costing you thousands of dollars. With most economists in agreement that interest rates will most likely rise by the end of the year, the first way you end up behind the eight ball is with a higher interest rate for your mortgage.
Consider this – if rates move from their current 4% up to 5%, a $300,000 mortgage jumps $177/month from $1434 to $1611 for principal and interest. Or, that payment of $1434 now only buys you $267,000 worth of mortgage money – $33,000 less, which puts you in a different price category.
The combination of lower interest rates and moderate price appreciation also gives today’s buyers a huge leg up over renters and delayed purchasers when it comes to building long-term wealth.