You were planning on buying a home recently, but your mortgage pre-approval drowned in a sea of rising interest rates. You may still want to buy a home eventually, but until something shifts, you can use this unexpected extra time to rethink your needs, adjust expectations, and prepare for buying later.
Re-evaluate your current situation. In slowing down your house hunt, you’ve given yourself the gift of extra time. You can reassess what’s realistic and desirable for you, without pressure.
Improve your financial position. If you don’t have enough down payment or monthly income to offset higher payments, then you can take more time to build savings through a side job or by increasing your salary.
Adjust your interest rate expectations. You’ll probably have higher monthly payments for years to come. If rates do drop in the future, you can refinance. If they don’t drop, then you’ll have built equity.
Consider these alternatives. If building wealth through home ownership is more important to you than living in the home you own, then you might consider buying a rental property instead of your primary home. You might also consider qualifying for an ARM (adjustable-rate mortgage).
Even if you can afford to buy now, should you wait for home prices to drop? Prices will likely come down eventually. But will they come down enough to offset higher rates? Rates are likely to rise even further in the next few months, so locking in a rate now might ensure you of a better monthly payment. And you might be able to negotiate a lower price now, instead of waiting for that same price later.
If you want to buy now, or need to make a plan for next year, contact me for a no-obligation consultation. (718) 399-3320