If you are shopping for a home in Florida right now, you have undoubtedly seen the news about interest rates. At the time we write this, mortgage rates are the highest they have been since 2001, hitting 7.23%.
Should you change your plans and wait for interest rates to come down? Not necessarily. While the drawbacks of higher interest rates are obvious, there are actually some compelling reasons to buy a home at a time when interest rates are high. Let’s take a look.
Reasons to Continue Buying a Home Despite High Interest Rates
- A better chance of getting your dream home. You might actually have a better shot at your dream home when interest rates are high, for a couple of reasons:
- It may be harder to sell homes, so more of them stay on the market for longer, increasing your options.
- There may be fewer competing buyers to deal with, giving you a better chance of getting the perfect home when you find it.
- You don’t want to miss out on your chance to buy your dream home. If you do find your dream home, another buyer will snap it up if you don’t. You probably are only going to get one shot at a specific property. If you let it pass you by because of high interest rates, you will not get that chance again. You might find another home you love, but not this one. So, if you have absolutely found your perfect home, moving forward makes sense.
- You might find a good deal on a home. When other buyers decide to put off their home purchases in the hopes that rates will drop, the housing market may cool off. If it does, sellers may be forced to drop their prices or accept lower offers than they would have otherwise. So, even if you end up with a higher interest rate, you might be able to purchase a home for a much better price than you would in a different situation. If your home is less expensive, you will be able to pay off your mortgage more quickly. That could mean paying less interest over the lifetime of your home loan. Another advantage is that your down payment could account for a larger percentage of the home’s purchase price. This in turn might actually have the effect of bringing down your rates a bit.
- Your rates do not have to stay high forever. Just because interest rates are high when you are shopping for a home, that does not mean they are going to stay that high over the years ahead. You have a couple of options:
- 1-Buy the home with an adjustable rate mortgage. If rates decrease in the future, you should also end up paying a lower rate later down the road.
- Or …
- 2-Buy the home with a fixed rate mortgage, but refinance it in the future when rates drop.
- Either way, you should not need to keep paying the high rates.
- You only live once. There is no denying that managing finances is hard. Making money takes a lot of work, and sometimes it can be scarce and challenging. But one thing you can never make back is lost time. Once years of your life are behind you, they are gone. You might make some financial sacrifices to buy your dream home now at a higher mortgage rate—but at least you will living your best life starting right away. The alternative is to sacrifice that best life for a while as you wait for rates to drop. That decision cannot be reversed. For a lot of people, higher interest rates for a time are absolutely worth it to make the most of their lives.
We Can Help You Buy a Home with Competitive Rates
A beautiful home is waiting for you right now in Florida, and you do not need to wait for rates to come down to buy it. In fact, it may even be beneficial for you to shop for a home now, while there are fewer competing offers for homes that interest you. To get started now, please call 954-840-8811.