QUESTION: I’m almost ready to buy a house, but I’m worried about interest rates. Should I wait until rates come down?
ANSWER: Interest rates, whatever they are, are never a good reason to put off buying a home. What we saw over the past several years — rates well below 4 percent — might never happen again in our lifetime. Besides, if you buy now and rates plummet, you can refinance. And if rates go up, you can call yourself a genius.
So my advice is simple: If you want to buy a home — and you’ve got the money — it’s a great time to buy a home.
Trying to predict interest rates (or the stock market) is impossible. If it were possible, becoming a billionaire would be fairly easy.
For example, everyone (EVERYONE) expected rates to continue higher by mid-July. What happened? They dropped, and it was the biggest decline since 2008. What comes down must go up. Probably.
The rate for 30-year fixed rate loans stands today at about 5.3 percent. By historical standards, that is a steal.
Here’s a few more reasons to buy now: prices have softened, sellers are more nervous, and there is a lot more inventory on the market than there was just a few months ago. States where prices spiked the most over the past few years (Idaho, Montana, Arizona, and Nevada) will probably see price declines of 5 to 10 percent over the next year, according to Realtor.com. But virtually nobody is predicting a crash in housing prices.
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