Why Buying a Home Now Still Makes Sense Despite Higher Interest Rates
With mortgage rates higher than they’ve been in recent years, many potential homebuyers are asking: “Should I wait to buy a home?” While higher rates may feel intimidating, there are several compelling reasons why buying a home now can still be a smart decision. Here’s why:
1. Building Equity Beats Paying Rent
When you rent, 100% of your payment goes toward your landlord’s pocket. When you own a home, each mortgage payment helps you build equity in an asset that historically appreciates over time. Even if rates are higher, you’re investing in your future rather than paying for someone else’s.
2. Secure the home and refinance later. There are mortgage companies that offer a great opportunity up to three years to refinance. (Always check with the mortgage company you intend to use.) Interest rates fluctuate over time. By purchasing a home now, you secure the property you love, and if rates drop later, you can refinance to a lower rate. The home you want may not be available when rates decline, but locking in ownership ensures you don’t miss out.
3. Less Competition in the Market
Higher interest rates often reduce the number of active buyers, meaning less competition for homes. This can lead to better negotiating power, more seller concessions, or even price reductions, helping you secure a deal that offsets some of the impact of higher rates.
4. Home Prices Are Likely to Continue Rising – especially with the California disaster.
While rates may feel high now, waiting could mean paying more for the same home later. Real estate tends to appreciate over the long term, making a purchase now a hedge against future price increases.
5. Tax Advantages of Homeownership
Owning a home comes with significant tax benefits. Mortgage interest and property taxes are often tax-deductible, which can help offset the impact of higher monthly payments. (Always consult your tax accountant as to all the advantages you may have in purchasing a home)
6. Stability and Freedom
Homeownership offers stability and control that renting cannot. You can personalize your space, avoid sudden rent increases, and settle into a neighborhood you love.
Final Thoughts
While higher mortgage rates may feel like a hurdle, they don’t have to be a deal breaker. By focusing on the long-term benefits of homeownership—building equity, locking in today’s prices, and gaining stability—you can make a smart financial move that sets you up for success. You can also ask the Seller for help to buy down the interest rate as part of your offer and negotiations.
Give me a call and let’s discuss how we can make homeownership a reality this year!
8500 Menaul Blvd, Ste A-240
Albuquerque, NM 87015
505-639-2090
MaryCockburn.Realtor@gmail.com
