With all kinds of pressure of mortgage rates and housing prices, it would seem all potential home buyers could use a little luck of the Irish in pursuit of their next home. Since I don’t have access to a Leprechaun or the Blarney Stone, we are going to have to manufacture some luck of our own.
Nobody likes higher prices, and nobody wants to see higher mortgage rates. Unfortunately, there is no avoiding the fact that these are things we must deal with and if we don’t, what are to options? We could not buy a house, but that means paying higher rents as rental increases are significant across the country; or continue to live in our current house, one we would rather not live because it doesn’t function as we need it to.
The choice is to bite the bullet and move forward. Mostly because the houses are continuing to rise in price, and there is no sign that the mortgage rate market is going to settle down any time soon!
So, we do math!
- What do higher prices really mean to each specific client?
- How much are home prices in your area rising?
- With higher prices, how much more do we need to finance?
- At higher rates, how much more is the payment?
- What will that cost look like in one month, two months, or more?
Once we are under contract on a home and the rate on the loan is locked, the costs and the payments stop rising, and property appreciation now belongs to the buyer going forward, and we have frozen our P&I payments into the future. While nobody can guarantee property values will continue to rise, and mortgage rates may not push higher; recent history tells us that stopping higher prices and higher rates as quickly as possible is a good thing!
Remember, people are seeing higher prices everywhere! Isn’t it nice to stop the rise in something? So, get your people prepared to be as good as they can be. Have your fully documented preapproval, make the best offer they can first, accept the fact that there is no way to get yesterdays prices or yesterdays rates, but todays prices and rates will be yesterday’s tomorrow!
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