Many experts are currently discussing a variety of topics such as real estate as an investment, the movement on mortgage interest rates and reasons to buy now instead of waiting. It is important that we realize that this does not apply solely to the first time home buyer.
The opportunity that exists in real estate today is there for everyone.
However, the family that already owns a home might be thinking that, if they wait, their home could be worth more next year than it is now. And that may cause them to delay moving up to the home of their dreams thinking it makes good financial sense. Actually, the opposite is true. This is the best chance a family has to buy up into the home that makes sense for their family right now.
We must realize that whatever percentage of value we gain on our house will also be gained on our dream home.
Let’s assume your current home is worth $500,000. Your house will be worth $520,000 next year if prices rise by 4% over that time (a number projected by the Home Price Expectation Survey).
However, the $750,000 home you are hoping to move into will also appreciate by about that same 4%. That means next year it will be valued at $780,000. You wouldn’t make $20,000 by waiting. You would actually be losing $10,000 ($30,000 – $20,000).
And, you will pay a lower interest rate on the mortgage than you probably will next year.
Plug in the numbers that apply to your house and the home you are longing to buy and see what the bottom line turns out to be for you.
That is how wealth is built in this country – by purchasing real estate at the right time, at the right price and at the right terms.
Go out and find your family’s dream house and buy it! Ten years from now, you will be glad you did!