This year is starting out crazy, once again with bidding wars on lots of homes. So, should you wait until summer when the market cools off? Lets look at the numbers and you tell me.
Over the last 5 years median residential home prices (detached and attached) have risen between January and June by an average of 13.5% as follows—
If prices were to rise 13.5% over the first 6 months of 2018, the median residential home price will be $437k, up from $385k, a whopping increase of $52k! And at a 4% interest rate that is a payment increase of $250 a month. But, what happens when interest rates rise? I bet our FHA 30 year fixed rates will be 4.50% or higher by July. Then, your monthly payment will increase by a total of $370 a month!!!
Let’s be conservative and say prices will only rise 7% this year, this still puts the median home price at $412k, an increase of $27k. And with higher interest rates your monthly payment will still increase by $245 a month!
Thus, you should buy a home as soon as you can as waiting will cost you some serious money.