I first want to say, the timing and choice to buy a house is different for every household. Sometimes, the timing just isn't right, and that's okay!! Perhaps you may not be staying in the area very long, or you have other financial goals you want to accomplish first. I completely understand that. Renting would be a great choice for you!

That being said, the perspective I would like to address is: perhaps you, or someone you know, is waiting for the "Time to feel right". As with many things in life, I find that the timing may not often feel right, or it is a rare find, anyways. 

For example, during the COVID housing era, rates were artificially lowered by the government to stimulate the housing industry, to provide jobs, and financial stimulus to a struggling economy. It may have "felt right" to buy a that time because the 2.75% mortgage rate was "too good to give up!"

These days, unfortunately, house prices continue to rise, and we expect them to rise over the next 5 years, and it's possible we will not see lower rates for another 12+ months. 

So then, that begs the question, what is the cost of waiting to buy a house, or is there logic in buying a home even if it doesn't "feel right"? What if your rent payment is lower than your new mortgage payment? (This happens sometimes).

Let's take a look at what you may be missing out on, if you'd choose to rent for another year or so, while waiting out the market.

1. Property Appreciation: for an average first time homebuyer purchase of $300,000, based on a conservative, low estimate of 3% growth per year (most are forecasting 4-5% growth per year over the next 5 years), average monthly net worth (wealth) increase will be $750/month, or $9,000 per year. This will happen with an increase in equity in your home. It's not directly cash in the bank, but when you sell the home in the future, it'll be a nice payday for your family, that is not taxed! (so long as you live in a property 2 of the last 5 years there is no tax on your profits from the sale of real estate).
2. Mortgage Amortization: What does this mean? Part of your monthly payment is towards mortgage interest. But another part is towards the principle, or your actual loan amount! For the same $300,000 home, with an average first time homebuyer mortgage, you can plan to build $260.41/month in equity because that's how much, on average, your mortgage payment will pay down your loan.
3. To put it all together, you're building over $1,000/month on average in wealth for your family by buying a home instead of renting. $1,010.41 to be exact!
4. let's say your current rent payment is $1,950 / month and your new mortgage would be $2,500. Sounds more expensive right? However, about $1,000 of your $2,500 mortgage will be "yours to keep" as equity/net worth/wealth in your new home, every single month! How cool is that?

Questions on this? As always, feel free to call/text me at: ​414-488-0438​​​.