On the fence about Buying or Leasing another Year?
Here's the situation: Your lease expires this summer, you've been looking at homes online, and nothing is really perfect. Your choice, try and find something now, and maybe settle a bit for less than perfect, or save some more money and buy next year this time. Maybe the Sellers market will not be so bad... Sounds logical, but let's break that down and look at each part in detail.
Interest Rates- the overwhelming consensus is interest rates are going up
How far and how fast is the question ... here is a breakdown from various experts. Some are above 5% at year end, still low by historical standards, but it makes homes less affordable as we'll see.
Buying a $300,00 Home
Now lets look at the impact of rising mortgage costs, and appreciation. I'll use two examples. A first home buyer is considering a home in the low 300's this spring. She has an estimated mortgage of $300,000, Charlotte's appreciation last year was 5.4%, the chart below adds 4%
So, a rise of $226 /month means you have to earn an additional $775/mo, $9300/per year to qualify and buy the same house.
Overall, you had to pay $12,000 more for the house plus, 12 months of rent, assuming $1800 x 12 = $21,600... That looks like $33,000.
By the way, Dilworth, Midwood, Sedgefield- these markets are going up ar 5-7% per year.
Buying a $700,000 Home
So a $529 per month increase, you will need to earn an additional $1600/mo, $20,000 a year to qualify, to buy the same house.
If the area appreciates at the same 4%, then you'll pay $29,400 more for the house, and 2000 /mo in rent x 12 = 24,000, for a total $53,400. and an extra $529/mo as long as you have this loan. Ouch!
This is our reality, the time to get off the fence is now!
As for a let up in the Seller's Market, at least here in Charlotte, I see that continuing long into the future along the light rail line neighborhoods of Charlotte. We are at the beginning of an upward curve in home prices, and land is now about $1M an acre... so, a Seller market at ever higher prices will continue. It may be different in the suburbs, but I wouldn't bet on it.
I'll leave the conclusion up to you, but there is truly a HIGH cost of waiting just a year.
Author:Terry McDonald Phone: 704-390-6221 Dated: May 8th 2018 Views: 543 About Terry: My Relocation Story
I came to Charlotte, from Hoboken, NJ, just outside the NYC area with a wife ...
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The McDonald Group at EXP Realty is a group of professionals, dedicated to helping our Clients win in real estate. Expert and honest advice, local area knowledge, and seriousness of purpose but with folks who don't take themselves too seriously. The founder Terry McDonald, was a builder for 20 years, and has been a broker for the last 13 years. Buying a home or selling, first home buyer or relocating to Charlotte,the McDonald Group is here to serve. Our client list includes first home buyers to luxury homes, professional athletes, business owners and physicians. From in town to South Charlotte, Lake Norman too, we know Charlotte.
The Group's core values are all about integrity and market expertise. We look out for their clients interest above all others. We are a learning organization, and big believers in training and lifetime learning. Sellers know us for our technological savvy, our aggressive marketing, and the ability to consistently beat the averages in Days on Market. Buyers love us, we never pressure anyone, yet were able to save our Buyer clients 44% off the market average in 2013- and now that the market has changed we win more than our fair share of multiple offer situations.
Reviews on Zillow
"It was a great pleasure to work with Terry McDonald. English is not my first language so forgive any mistakes. The first time we met Terry was 5 ... more "
by polina katz
"I worked with Bobby on both buying and selling my home in Charlotte. He is so personal and cares about finding the perfect home for his clients! I ... more "
"Terry was exactly the agent we needed for our relocation from the New York area to Charlotte. We first explored a move to Charlotte a couple years ... more "
Open House Saturday 1-3 Close to Southpark, Close to the Li
"I was living in Florida and looking to move to Charlotte area. I found Terry through the internet and explained my plans of moving to the area with my wife and kids. He was very diligent and honest in market values, location, schools, etc.. even offered advice for relocating. While I was in FL. he would send me listing meeting my criteria, he also advised for things I should be aware of that I hadn't even thought of. I eventually made my way to Charlotte and met up with him for a weekend. We nocked it out in a weekend, he had found the perfect home for me and my family. We made an offer and I went back to Fl. I thought it was going to be difficult to close while being away, but he made it happen..
I only needed to come back to sign the closing.
In 201, I was relocated to Virginia, I asked for Terry to help me rent the home while I was stationed in Virginia. He recommended an agent, It was rented out within a month and with an Incredible Tenant.
In 2014, It became apparent that I would no longer be moving back to Charlotte, I then contacted Terry to put the home up on the market in a time when it was a very difficult time to sell property, but again he made it happen. This time around, I was in Virginia the whole time.. It was difficult for me to make in back to Charlotte for any type of transaction. I trust Terry so much and am very thankful for having met him. he completed all transactions without me having to be there. Once the property closed. I received a check within weeks..
In a time when you need for things to happen and you need to trust someone unconditionally. Terry will be there.