Recently a buyer client got nervous when preparing to write an offer on a home and said they thought it might make sense to continue to rent and see what happens with the market and interest rates. I changed a few specifics but thought my response to them might be helpful information as people wonder what’s happening with our local real estate market.
Hi! I can totally understand getting cold feet! In fact, that's totally normal — short-term buyer's remorse happens more often than not when buyers are purchasing.
If it's a case of not being completely sold on this particular house, that makes total sense and you should wait until you find the right home. If it's a matter of thinking that interest rates are going to go down and/or that renting for another year is a better option, then I worry a bit.
I think if you do a quick Google search, you'll see that interest rates are not expected to go down, rather they are expected to rise even more. Here is an article dated 7/1 from Forbes Advisor that talks about this. Even worse, the interest rate on renting is 100%!
Although prices have softened a bit as inventory has increased, it is unlikely that prices — particularly on the lower end of the range where you're shopping — will decline enough to make up for the amount you'll spend on rent if you do so for a year ($24,000).
I honestly believe this month and next month will be a great time to buy. After that, buyers will get used to the idea that rates have gone up, people will stop being anxious about the stock market, and those sellers currently trying to ‘capture the peak of the market’ will have all sold or changed their minds and pulled their homes off the market. Buyers will come back in force as people continue to move here, inventory will level out, and the current opportunity to get a good price and have choices while everyone is panicking will be gone.
My 2 cents! :)
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