Why Waiting to Buy a Home Could Cost You More

By Misty Darling

Professional service with an emphasis on guidance, planning, and dedication to my clients’ needs are my top priority.

If you are considering buying a home but feel uncertain because of current interest rates, you are not alone. With rates higher than we’ve seen in recent years, many potential buyers are hesitant. However, waiting to buy could end up costing you significantly more than you expect. It’s not just about home prices increasing; it’s about missing out on equity and wealth-building opportunities that could take years to recover.

One tool that is gaining traction again in the home-buying world is the buy-down option. This option, which hasn’t been widely discussed in recent years, has become a great way to make homeownership more affordable, even in today’s market. Envoy Mortgage offers a lender-paid buy down, which reduces your interest rate by 1% for the first year at no additional cost to you. This means lower monthly payments during that first year, making it easier to manage until interest rates come down and refinancing becomes an option.

The real eye-opener comes when you calculate the cost of waiting. Using a cost of waiting calculator, I looked at what happens if you wait a year to buy. For example, let’s say you are considering purchasing a $320,000 home at a 7.25% interest rate. If you decide to wait and the home price rises to $339,000, even with a reduced interest rate of 5.5%, you are still paying significantly more. Your down payment would increase, the loan amount would be higher, and you would lose out on thousands of dollars in potential equity.

When you buy now, you begin building equity immediately, which is one of the most effective ways to grow wealth. Renting, on the other hand, builds no wealth at all. It’s simply paying someone else’s mortgage. Even though interest rates are high now, purchasing a home means you are locking in equity gains from the start. Homes are not losing value; in fact, prices continue to rise. The longer you wait, the more you will end up paying, both in terms of home prices and missed opportunities for wealth-building.

For those waiting for interest rates to drop, the reality is that while rates may come down eventually, home prices are still climbing. The longer you wait, the more expensive the home will become, and the more you will lose in potential equity. In some cases, waiting a year can set you back 10 years in terms of financial recovery.

If you are thinking about buying a home, don’t focus solely on today’s interest rates. Consider the bigger picture. Buy the home now, lock in the equity, and refinance later when rates come down. The sooner you get into the market, the sooner you start building wealth through homeownership. Waiting could cost you thousands. If you need an expert to help you in buying a home, you can call me or text me at (515) 346-6803 or send me an email at Misty@BHGInnovations.com.