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Why Now is Still a Good Time to Buy

August 29, 2022

Markets move and change. Rates change-the market is dynamic. This can be scary but it doesn’t need to be! We put together a few points that may ease your mind when it comes to questioning if now is truly a good time to buy because of rate increases. We still say, yes, now is a good time to buy–here’s why:

1. We have been here before. Over the last 20 years, interest rates on homes have ranged from 8.5% to below 3.0% in some cases. Right now as interest rates increase, it feels high but historically, it has been higher. In fact for those of us old enough to remember the late 1980s/early 1990s, rates were in the double digits! We get it, that doesn’t help for the right now but we do know that historically rates go up and down and that this too shall pass. It doesn’t mean housing is not affordable now.

Let’s take a recent example to better illustrate this. In the last week or so, we have seen an increase in rates of .8%. An increase like this adds $159 a month to your monthly payment. And, when you break it down,  you can begin to see that this is manageable. It’s not going to increase your monthly payment enough to cause you to not be able to buy a home. Let’s put it in perspective: One night out to dinner for a family of 5, costs between $100-120 after tip etc. If you are a young married couple who enjoys going out with your friends on the weekends, this probably breaks down to 1-2 nights a month of a good night out on the town. So, you can see here that while it seems like a large increase, it’s definitely manageable. (Plus, how fun would it be to host your friends or family for a night out in your brand new home? Giving up that one night out is replaced with some pretty awesome memories built around your new home!)

2. A home is an appreciable asset over time. Let’s use that same $159 a month we mentioned above. Something to consider is that your home is an asset and this is an investment in your overall financial landscape. Going out for dinner or a night out with friends, is not an investment. That money is forever gone. When you purchase a home, your investment in that home grows giving you a better financial landscape. A recent study done by CEIC Data indicates that residential real estate investment has increased 5.3% year over year in the past 20 years. 

3.The real cost of waiting. It may seem like the right time to hold off on purchasing a new home and just rent until rates go back down. This is not always the best option. When inflation rises, if you have a fixed mortgage, your cost of housing does not rise.  If you are renting however; the rent will go up with everything else. Someone else is in control of that rise. If you want certainty in your monthly payments, purchasing a house is the way to go. 

4.Refinance opportunities later-Your house is the easiest asset you own to refinance and because rates are ever changing, you can refinance anytime you need to when the rates drop again. Some experts believe that rates will drop again in 2023 and that by 2025 the housing mortgage rates will drop again to help affordability of home purchasing. 

5. Now is the perfect time to purchase a new home rather than an existing property. When you make the decision to build, you get to select your finishings, your lot, and your floor plan; and, because your home is an investment you will be in for a while, to choose what you get to put in your home rather than accept what is already there provides great design opportunities. In some instances, it could even save you money because you get what you want right from the start rather than moving in and refreshing or remodeling your space. Further, in some cases, rates as low as 4.375% on move in ready Spec Homes and 4.75-5.125% on a 240 day lock on a new build. This is the perfect opportunity to consider a new home. *

We are here to answer any questions you have and help point you in the right direction towards your new home. Contact an Ashlar Homes representative today at info@ashlarhomeskc.com

* Interest rates are ever changing. These rates are at the date this article was written, 8.29.22. For up-to-date rates, email your Ashlar representative at the email above.

We built with Ashlar Homes and had an amazing experience. All the staff we worked with were great people and always super helpful! I love our house! If we were to ever build again, we would build with Ashlar Homes 100%!!

Anna