The real estate market has changed a lot in the last couple of years and it has many people sitting on the fence. If you’re trying to decide if you should buy or wait, you’re not alone. It’s not only buyers with this conundrum but sellers are also wondering if they should hang on to their homes a bit longer. We get it. It’s a big decision and can be difficult to navigate. At June’s Team, we offer years of experience as a Colorado realtor and have seen the market fluctuate greatly over time. Not only do we have the experience and credentials to navigate the market, but we also have the care and concern for our clients and make sure we do what is best for them in any market.
At June’s Team, we pride ourselves in serving our clients well and creating strong relationships so we remain their realtor for life. With us, you aren’t just another transaction, you become a part of the family. Two of the greatest values at June’s Team are to serve instead of sell and to never stop growing and striving to be the best. These are what set us apart from other realtors and truly create a positive change in real estate.
Often times when people wait for things to “get better” before taking a step forward, they are doing it out of fear. There are typically a lot of “what ifs” about making the wrong decision or acting at the “wrong” time. While it’s natural to feel cautious, making decisions based on fear can lead to missed opportunities. As your trusted Colorado realtor, we’re here to provide insights and tips for making an informed decision that aligns with your long-term goals.
A Lesson on Housing from the 80’s
Doing nothing may be a lot more costly than doing something. With rates twice what they were in 2021 and the first half of 2022, many buyers are sitting on the sideline. For some, it has to do with not being able to afford the home they want at today’s mortgage rates, and for others, it is not willing to accept that the low rates that were available are not only gone but may never be available again.
In the late ’70s, rates were around 10%, and in the early ’80s went up to 18%. Interestingly, many buyers went ahead and purchased at those record-level highs and refinanced a few years later when rates came down. By the end of the decade, prices had continued to increase so that buyers had a significant equity in their homes.
Tenants who waited for the rates to go down didn’t see savings because the price of homes had gone up. More importantly, they missed the opportunity to build equity in their home through amortization and appreciation.
If you purchased a $400,000 home today on an FHA loan at 6.3% for 30 years, your total payment with taxes, insurance, and mortgage insurance premium would be about $3,459 a month.
That payment could save you a little bit if you were paying $3,500 for rent. However, when you consider the monthly appreciation, assuming a 3% annual rate, and the monthly principal reduction due to amortization, the net cost of housing would be $2,229. You would be paying $1,270 more each month to continue to rent which would amount to over $15,000 in one year alone.
That loss would be about twice the amount of the down payment to get into the home. Furthermore, in seven years, at the same 3% appreciation, your $7,500 investment in a down payment would grow to $138,000 in equity in seven years. If the appreciation is greater than that, the equity would be much more.
You’re going to be paying rent to live in a home; you might as well benefit from the equity buildup from amortization and appreciation that is only available to the owner.
The benefit of acting now with the right Colorado realtor is that sales are down which is affecting prices, although not dramatically. When the Fed gets a handle on inflation, and interest rates do moderate some, more buyers will be in the market, and supply and demand will again cause prices to rise. Then, you can refinance to a lower rate but your investment in the home will be at a lower basis.
How to Decide if Now is the Time to Buy: Make the Best Decision for You
Understanding Today’s Market:
A Look at the Past and Present: We start by putting today’s interest rates in context, and comparing them with historical patterns. This perspective is often eye-opening. As your Colorado realtor, we will give you all the data you need to feel great about your decision.
Real-Time Market Insights: Our Colorado realtor team constantly analyzes the real estate market, giving you a clear picture of what’s happening right now – the true cost of waiting versus acting.
Assessing Your Situation:
Financial Health Check: It’s crucial to look at your finances. Are you in a position to buy? We’re talking about more than just affording a mortgage; it’s about whether this step fits your financial goals.
Your Future Plans: Your long-term objectives are key in this decision. If a property aligns with your future vision, waiting for a potential rate drop might not be in your best interest.
Navigating Interest Rate Concerns:
The Unpredictability of Rates: Interest rates can be fickle. Waiting for a drop might seem wise but remember, the market doesn’t always follow predictions.
Refinancing as a Future Option: Buying now doesn’t mean you’re locked into today’s rate forever. Refinancing down the line is a viable option for many homeowners.
Informed Decision-Making:
Expertise at Your Service: Our role is to provide you with comprehensive information, helping you weigh both sides of the equation.
Fact-Based Decisions: We believe in making decisions grounded in current data, tailored to your personal circumstances and future goals.
June’s Team is your Award-Winning Choice for the Best Colorado Realtor
Buying a home is a significant step, and it should be based on a strategic evaluation of the market and your personal situation, not market fears. We’re here not just to help you find a home but to make informed decisions about when to take that step. Whether you are looking to buy or sell a home, we can help. Check out our resources for buyers and resources for sellers to get you moving forward on the right track. No matter where you are in your real estate journey, we look forward to walking with you each step of the way. Take a look at the current home listings we have available. We serve all of Northern Colorado.
Read some of our 5-star reviews from our happy clients
“June moved hell and high water to get us into our dream home. With equity the day of closing!!! We can’t thank you enough. We spent so much time together at this point, we are almost like family. Thank you June and your team.” -Kevin
“June has been a professional, kind, resourceful agent helping my spouse and I sell our home and getting us into a home and city we love! She listens and understands our wants and needs while so very helpful with all of the hurdles involved with home selling and buying. Her team has got you covered as well!” -Robbie
No Need to Continue Your Search for a Colorado Realtor – June’s Team is Here to Help
June’s Team at Keller Williams is well-established in the Northern Colorado community and serves clients in Greeley, Fort Collins, Loveland, Windsor, Eaton, and surrounding cities. We are the forerunners in Northern Colorado real estate and always have our client’s best interests at heart. Serving the residents of Northern Colorado is an honor and our love for the community is continuously growing. Two of our greatest values at June’s Team are to serve instead of sell and to never stop growing and striving to be the best. These are what set us apart from other realtors and truly create a positive change in real estate. Contact us today to get started or give June a call on her cell phone at 970-388-3692, or at the office at 970-573-5791.