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The fall of every year has become the “buyers market” season of every real estate year in the past few. While inventory may still be tight in some of our markets in the DC area (the DMV), many purchasers have hibernated, thinking that if they wait till the spring, they’ll be able to have better luck at finding what they want.

Such thinking could cost you a brick of cash. Because = there’s another key component you overlook if you’re just keeping track of inventory as an indicator of when you should buy. It’s the interest rates. It could cost you thousands of dollars per year to wait when you consider where they are right now and what could happen by the spring of 2018.

Here are some simple calculations – if you’re buying a $500,000 house with 5% down at an interest rate of 3.5%, the payment is roughly $2,641 in Fairfax County, VA… When that rate moves up a percent to 4.5%, your cost goes to $2,915. Same house, same taxes – $3288 MORE per year…$16,444 over the next 5 years — more than $30K in 10 years.

Waiting could cost you. The smart buyer stops waiting and get’s in the game! Got a question or need professional help? Contact me here: pmms_chart8.17

Home shoppers purchase two products when they buy a house – the property itself and a mortgage. The difference between the two is the house price is advertised in living color online, on postcards, in QR codes, etc. The loan pricing, however, is a little less dramatic.

The house listed in today’s market in Northern Virginia, while listed at $500,000, may actually sell for $515,000 or there abouts. The mortgage price, on the other hand, is measured in interest rates.

How will it effect your buying power? Take a look at the chart below and you can actually measure the power of your  monthly payment by watching rates move up and down. About a month ago, rates were around 3.5% – now they are roughly a full percentage point ahead of that mark (yes – 4.5%).

What’s the phrase? You snooze you… Oh well – 4% rates are STILL REALLY GOOD RATES. Give us a call if we can help you talk with a loan professional or see how these moves in the market affect your buying power. (703) 821-8300.

What can you buy for $2,000 per month?




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