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Updated 12/16/16

I must be honest. Explaining to a buyer who would rather "wait to save up some more for a down payment" or "pay off a little bit of debt" before they buy, is one of the most painful situations I have face as a Realtor. Especially if they have the financial ability to purchase. There are far too many options available in todays market for buyers to be "waiting to save. Waiting to save a few extra thousand dollars for down payment, or to pay off some credit card debt could cost you THOUSANDS of dollars.

For example, if interest rates increase by 1%, and the annual appreciation of the home increases by 5% (which is less than what we've seen in the last few years), waiting a year to purchase a home at $500,000 could punish you by $27,000 AND a monthly increase in payment of $500Over the span of the 30 year mortgage, waiting 1 year would cost you about $131,644.17.


Let's say that $500,000 is the maximum that you can afford. Assuming the price of the home does not appreciate (unlikely) but interest rates do increase by 1% (not unlikely). Waiting 12 months to buy would cost you about $50,000 in purchase power.



Great news!! If you just decide to BUY TODAY! It's very likely that you'll secure a historically low rate, and reap the benefits of an appreciating market, you'll save yourself $131,644.17, AND reserve bragging rights to the lowest interest rate in the neighborhood.... the Joneses will have their work cut out for them!

There's also a lot of talk around riding rates and depreciating home values. The reality is that while a lot of people still feel the burn from the fire of the great recession, most people don't understand how rare that time in our history really is. Especially in the Real Estate world. So, while it is possible for the market to dip in some areas, a drastic drop in prices (especially over a long period of time) is not common. In fact, we will likely see prices (in the Greater Sacramento area) continue to increase; just at a slower pace.