For the last year or so, cash was king. To win in a bidding war (virtually every home had multiple offers) you needed to offer big bucks (avg ~$50,000 in our market) past the list price. Today, with interest rates climbing – some ‘would-be’ buyers are back to casually surfing Zillow, and not actually writing offers (for now). There’s a good chance you’re the ONLY buyer for that big, brick beauty down the street. (Hmmm, I smell a deal…) So let’s think smart with our hard-earned $$$. How can I use this new leverage as a buyer? How much space do I need? Where should I look? Is that house I saw in Brookhaven really worth it? I mean, we all work remote now…right? No such thing as a commute…so let’s check the stats.
OTP vs ITP, the winner is clear…those city folk are only gaining equity at 14% and that 3,000 square foot home just cost them nearly a million bucks. Out here in the ‘burbs, we’re living large…on the cheap. Gaining equity well over 20%, and a similar sized home costs 70% of the price. So again, let’s think smart with our money.
Here are the facts: demand is down and rates are up. You don’t need to offer $50k above list price. Rates are about two percent higher than they were 6 months ago. Take away that extra $50k in “bidding war era” home price, and add 2% to the interest rate…you guessed it. It’s a wash when it comes to your monthly housing payment. It’s still a great time to buy.Money talks, and I’d love to talk money with you. Come see us OTP and we’ll help you see what you can comfortably afford.