The Downside of Buying When Rates Are Elevated

If you can comfortably afford the monthly payment, waiting for rates to come down could mean missing out on potential benefits in the long run. That lesson is personal for me, because I bought my first home in 2001 when my rate was 7.375%, and a few short years later, that decision had worked out well for me.

My 2001 home buying story

I still remember the sticker shock when I locked in that loan. But I was relieved to stop renting and finally own a place of my own. What I did not fully appreciate at the time was how much ownership was quietly working for me: Roommates helped offset the monthly payment, I paid down a little principal, and my home appreciated a little bit over time.

Then rates dropped into the mid 4s. My loan officer, who is actually the person who got me into this business, reached out to talk through refinance options and opportunities. I chose a 15-year fixed mortgage, and the monthly amount came in a little lower than what I had been paying on my 30-year fixed loan. That move helped me pay down the balance far faster.

Why waiting can come with a cost

I share my story because I see people panicking over rates in the mid to high 7s. Here is the thing: the headlines rarely tell you what delaying a purchase could mean financially.

Depending on your situation, waiting means missing out on potential appreciation, principal reduction, possible tax benefits on a primary home, and the chance to refinance down the road in a way that could save you money each month or help you pay off your mortgage that much sooner. Every month you rent is a month you are not building equity toward your own future.

Don't let the headlines spook you from your personal journey of creating wealth through real estate. If you have home financing questions or just want to talk through what your path could look like, I am happy to help.

Anton Auth Mortgage Loan Officer, Northpointe Bank, NMLS# 16103

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