Should You Buy Now or Wait? Decoding the Real Estate Dilemma
Welcome back to the Welcome Home Radio Podcast! In this segment, we’re wrapping up a few critical questions that are on the minds of both buyers and sellers: the timing of your next move, the true cost of waiting, and the often-overlooked necessity of building equity.
If you’re grappling with when to jump into the market, here is the essential guidance from our lending and real estate experts.
The Equity Reality: Why ‘Wait for Refinance’ isn’t a Guarantee
As interest rates remain elevated, many potential buyers are banking on the idea of buying now and refinancing later when rates drop. While that is a sound strategy, it comes with a major caveat: equity.
As Tom points out, to make a refinance financially worthwhile, you generally need to build up some equity in the property.
- The Risk of Overpaying: We are seeing challenges now with homeowners who overpaid for properties three to five years ago. As the market makes adjustments and local prices come down, these homeowners may find they lack the necessary equity to qualify for a good refinance option, putting them in a financially tight spot.
- Think Long-Term: Your purchase decision can’t just be about the current moment. You must be thinking about what your financial situation will look like in the future.
The Cost of Waiting: Home Prices Will Rise
While Tom’s caution is important, it’s balanced by the reality of the cost of waiting.
- Waiting Costs Dollars: If things are tight, waiting may feel like the only option. However, the decision to buy now and start building equity is almost always better because home prices will likely continue to go up.
- The Competition Effect: When rates eventually come down, the market will experience a surge in both buyers and competition, causing home prices to rise, not continue to fall.
If you wait, you may have a lower interest rate later, but you will also be purchasing a more expensive home, meaning the benefit could be canceled out by the higher purchase price.
A Warning About Online Lenders ⚠️
If you are a prospective buyer, please talk to a trusted professional! Be cautious about online shopping for loans. Online lenders often underestimate the true cost of the loan and the mortgage.
They frequently do not account for critical expenses like:
- MUDs (Municipal Utility Districts) and additional local taxes.
- HOA fees, which can surprisingly push your debt-to-income ratio too high.
- Accurate insurance estimates.
These overlooked costs can be the difference between a successful closing and having to back out of a deal.
The Seller’s Dilemma: Sell Now or Wait for 2026?
Our final question asks a critical timing question for homeowners: Is now the best time to sell, or should I wait until Spring 2026?
Our experts agree: The window is NOW to stand out before the competition arrives in 2026.
The Advantage of Selling Today
If your home is in good shape and you are ready to move, sell now. It is always a good time to sell if the financial opportunity aligns with your situation, especially if you have little to no debt on the property.
The Final Checklist for Sellers
If you decide to sell, make sure your home is presented at the highest level:
- Understand Your Market: Are you in the starter, mid-range, or luxury market? Price and present your home accordingly.
- Be Ready for Higher-End Expectations: If you’re asking for top dollar, your home must have a higher-end look and feel.
- Declutter! This is one of the hardest but most essential steps. Buyers need to be able to envision themselves in the space, which is impossible if your home is filled with 20 or 30 years’ worth of belongings.
Final Thought: Buy or Rent?
Remember: only 61% of Americans own a home. The remaining 39% are renting, and rents will continue to go up due to rising costs like insurance for landlords.
Renting is money you will never see back, period.
Whether you buy now or wait, please talk to a professional you trust. We are here to help you get to CTC—Clear to Close.
Follow, like, and share us! Help us educate others about the real estate market.
I’m Blair Thomas. And I’m Tom Holm. God bless.
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