Happy New Year to you! I hope your holidays were fantastic, with loved ones, and that your year ended on a high note. I was lucky to escape the "big Chicago freeze" while enjoying a family holiday in California, and it definitely sounded like the cold snap was well.... pretty crazy! But, we are here now in January, back to our resolutions, plans and work.
For 2023, I've been thinking a lot about the market, what it's done this past two years, and where it's going - and the experts at Bankrate.com and others are saying that rates in the 5's are here to stay. So, what does this mean for your plans to buy or sell, upgrade or downsize, or even to refinance? Well - you're in luck if you want to buy, as the continued high numbers are causing a lot of people to pull out of the market and "hold" so competition is far less than it was this time last year.
And REMEMBER: it's better to buy a property at a higher mortgage rate now, than to OVERPAY for that same property in times of high competition with a lower rate. Your payment is STILL lower. Try not to worry so much about mortgage rates - they are but one component of the deal, and you can "buy a rate down" to get it lowered. I can help you navigate all of it - Just ask me!
So in today's words... rates in the 5's also tell us that even small hikes in the numbers can make things more expensive, and the real time for "when is the best time to buy" was actually a few years ago during Covid, when most of us were reeling with a lot of uncertainty in the world. THUS, the best laid plans are ultimately what's best for you in the here and now:
If you need more space, you can find it. There is plenty of inventory that is affordable on your CURRENT budget. It just may not be brand new or already rehabbed. You can make the home of your dreams if you set your mind do it.
If you need less space, you have to arrive at the party understanding that buyers have higher loan costs, so their temperament for properties that need work or have inspection issues is going to have to compete now for their higher loan costs. Sellers have to be prepared to give a bit to get a bit. BOTH sides have to negotiate, and another buyer is NOT always around the corner. Try to see the bird in hand as better than two in the bush.
IF you want to rent, your realtor can still help you. You can sell a place and then rent for a bit to maximize your options, OR you can rent a bit before you buy, to make reaching your goal a better ride on your terms.
If refinancing is needed, then your realtor and mortgage professional can definitely help you to make a plan. The COSTS of refinancing must be taken into consideration and refinancing is only a good idea right this second, if your rate is well over 7% or you want to get out of a shorter term loan (like a 15 year) to get to a 30 year to lower your payment. I can help you sound all of this out.
Rates this year are likely to hold in the high 5-6% range and I am not hearing anything yet about anything less than 5's. THUS if you see a rate in 3, 4 or low 5%, it's a GOOD rate for the times, and you have to spring into action. For now, there will be ups and downs, but the amazing rates of 2020 and 2021 are gone at this point. Just remember that in a historical view, rates well over 10% were perfectly normal and no one freaked out. What goes up WILL come down.
IN THE MEANTIME though, if you want to look at a new home, just text me at 312-720-0082! I will be happy to meet you and to grab coffee, tour some places, and chat with you about making your plans a reality. I have lowered my sales commissions, so if you need to sell and want a reliable and trustworthy advocate for selling your home, I will do it on a discounted rate from previous years. I want to earn your business and your trust!
Do you have questions? Call me, email or text any time! I remain at your service, and I wish you and yours, a fantastic New Year.
All the best,
Alisa Levin, JD, LLM
E: firstname.lastname@example.org or email@example.com
Fulton Grace Realty