A look at short-term prices vs. long-term costs.
We recently shared that over the course of the last 12 months, national home prices have appreciated by 7.0%. Over the same amount of time, interest rates have remained historically low which has allowed many buyers to enter the market.
As a seller, you will likely be most concerned about short-term price where home values are headed over the next six months.
As a buyer, however, you must not be as concerned about price, but instead about the long-term cost of the home.
The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year.
According to CoreLogics most recent Home Price Index Report, home prices will appreciate by 4.7% over the next 12 months.
What does this mean as a buyer?
If home prices appreciate by 4.7% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:
Bottom Line
If buying a home is in your plan for 2018, doing it sooner rather than later could save you thousands of dollars over the terms of your loan.
Regarding the specifics of Seattle, check in with your Metropolist broker and get the needed local details of our current competitive market.
