As we all know, as time goes on the cost of just about everything rises with inflation. Bread, Gas, Milk and of course the average cost of a home have all risen in the past 20 years!
However the cost of "Purchasing" a home has not gone up, due to historically low interest rates.
With a lot of industry leaders saying interest rates are due to rise soon, one of the questions buyers have now are; "is now the right time to purchase a new home?"
Interest rates are currently only at 4.5%. If you were to take that 4.5% interest rate and wanted to spend a little over $2,000 a month on your mortgage payment, you would be able to purchase a $400,000 home. If you wait until 2015 when interest rates are expected to be (5 - 5.5%), that same $2,044 a month payment will only get you a $360,000 home. In other words, you will lose $40,000 in buying power if you wait until rates go up, which they inevitably will.
If you have any questions about buying power and how this will effect your buying power - please contact me, I would love to answer any questions you may have, thanks!