To Buy or Not to Buy

Buy now, or wait until 2024? That’s the question prospective homeowners are struggling to answer in today’s housing market. Home prices skyrocketed throughout the pandemic and mortgage rates are soaring too!  The combination is leading many potential home buyers to “wait”.

However, after sellers holding a steady advantage for the past few years, things are starting to look better for buyers in many parts of the country. Popular East Coast states that had seen skyrocketing prices, are now seeing double-digit year-over-year declines. 

So, is it time to buy? Or, is it better to wait on the sidelines in the hopes that prices or rates see a significant drop soon? Here are some key considerations to help determine the way forward.

Should I buy now?

No matter which way the real estate market is leaning, buying now means you can start building equity immediately. It also means avoiding the potential for additional mortgage rate increases later. Rising rates can spell serious trouble for your monthly budget, and they result in paying more in interest over the life of the loan.

In general, if you can answer yes to these three questions, now is the time to buy.

1. Do you have excellent credit? The best deals on mortgages will be available to those with high credit scores of 740 and above. If you demonstrated that you are a low-risk borrower with history of on-time payments, you will be in line for the lowest mortgage rates a lender can offer.

2. Have you saved enough for a down payment? In addition to paying your bills on time, you should be sitting on a sizable amount of money for a down payment.  Make sure you have money left over too to provide a cushion for the expected.

3. Are you expecting to stay in the home for a while? Beyond the purchase price, buying a home comes with closing costs that can run thousands more. So, to justify those one-time transaction costs, it’s wise to be reasonably certain that you will not move again anytime soon.  

Should I wait to buy?

If you want to become a homeowner but are waiting for mortgage rates to come down, you may need to be patient. While rates were around 5.5 to 7.5, percent as of recently, things may get better sooner than you think. We are predicting 30-year mortgage rates to fall below 6 percent by the end of 2023.Of course, it is impossible to predict where rates will really land by the end of the year but we think the outlook is promising.

Deciding where you should buy really depends on the market you are looking to buy in.  Regardless of national headlines, real estate is hyper-localized and can vary greatly from one market to another, even within the same state. Good thing Roman Balandin Realty knows New Jersey real estate and can help you successfully navigate your market and help you buy and sell smartly.

Bottom Line

Trying to buy a house right now may feel overwhelming but waiting too long can present challenges as well.  Review your finances in detail and think about how much you are able to pay as a down payment.  Be sure to take the pulse of the town in which you are hoping to live. Then talk with a real estate agent (We have many amazing agents qualified to get you the best home at the best price!) to figure out the best way forward.