Waiting to buy in Chicago could mean higher mortgage payments
We live in uncertain times and clients these days, perhaps more than ever, are asking themselves if now is the right time to buy.
Fence-sitters beware, though, says a new study from Zillow, which notes that waiting could mean a much higher mortgage payment down the road.
The online brokerage notes that at a 30-year mortgage with a 20% down payment, rates are at a 50-year low. That’s right. The last time it was this good of a deal to buy a home was in 1971.
With interest rates at 2.68%, the monthly payment on a typical U.S. home was $862 in December, but that number is projected to jump to $952 by the end of 2021. And while interest rates could drop lower, those savings on borrowing could get wiped out by rising home values.
“Low interest rates are helping keep down monthly payments while price appreciation is working in the opposite direction,” the study noted. “While it’s good news for folks looking to rely on these lower rates today, it will take more time and money to save up for that initial down payment. There are also additional costs that offset some of the benefit of these low rates.” Read more