What If?

Buying a home is filled with all kinds of decisions that must be made. This oftentimes comes with a slew of questions that must be answered, leaving the buyer wondering ‘What If?’ a lot. What if the market tanks right after we close? What if interest rates drop and we could’ve saved a bundle? What if, what if… what if? Because the market has been relatively unstable this year, these types of what if questions can actually be pretty paralyzing. 

It’s Ok. 

Purchasing a home is one of (if not THE) biggest financial decision you’ll likely ever make. Asking these questions is important but it’s equally important not to let yourself be so overwhelmed by the possibilities that you end up doing nothing. 

Let’s look at that first worry. What if I buy now and prices end up dropping immediately? This is the most common worry. In fact, 72% of homebuyers list affordability as their top concern, causing some to wait out the market until prices drop. Only… they might not, and likely won’t. At least not drastically enough to make a huge impact on a monthly mortgage payment. Plus, any gains or losses after closing are really only imaginary until the day comes that you decide to sell. If you buy now and prices DO tank, just breathe. Markets recover, so maybe you don’t sell again right away. 

Secondly, what if you buy now with a high interest rate and they end up falling? Seeing as mortgage interest rates are the top concern of nearly 80% of would-be buyers, a lot of focus is put on them. Today’s rate that is hovering between 6.5-7% deserves a bit of a reality check. The pandemic rates of 2.5-4% that we’ve seen the past three years are practically unheard of. In fact, the average rate over the last 30 years is… you guessed it… 7%. Rates only seem high based on comparing the last few years. However, let’s say you buy at 7% and rates do dip back down below 5. You can simply refinance! 

Basically, keeping things in perspective helps. Don’t let the big picture overwhelm you and stick to your household finances. If it’s in your budget and it’s a home you love, go for it.