The dream of purchasing a home often comes with questions about timing. One of the most common reasons buyers hesitate to purchase a home is the anticipation that interest rates will continue to drop.
While lower rates might seem like the key to affordability, waiting can come with unexpected costs—both financial and personal. Here’s why acting sooner rather than later may be the better choice.
Rising Home Prices Outpace Interest Savings
Housing markets, especially in Calgary and area, continue to rise. A modest rise in property prices often offsets the potential savings of a lower interest rate. For instance, if prices increase by 5-10% during your waiting period, the total cost of your home could far exceed what you might save on interest.
Another factor to consider is the ongoing increase in trade and material costs. Construction expenses, including labor and building materials like lumber & concrete, have been steadily climbing due to supply chain issues and inflation. Acting now allows you to lock in today’s prices before further increases make home ownership even less affordable.
Banks Offer Rate Holds with Flexibility
One of the benefits of buying a home now is that many banks and lenders allow you to lock in an interest rate for a set period—even up to 12 months. This means you’re protected against potential rate increases while you prepare to take possession of your home. Even better, if rates drop during that period, most lenders will let you adjust to the lower rate, giving you the best of both worlds! By acting now, you can secure your home and take advantage of rate flexibility.
Short-Term Loan Options Can Maximize Savings
For buyers considering quick possession homes, a short-term mortgage term can be a strategic way to navigate fluctuating interest rates. By opting for a one- or two-year fixed term, you secure a manageable rate for the immediate future while positioning yourself to refinance when rates are expected to drop. This approach provides financial flexibility and allows you to take advantage of potentially lower rates without committing to a longer-term agreement at current levels.
Pairing a short-term loan with a quick possession home means you can lock in today’s prices, move into your new home in just a few months, and revisit your mortgage options when the market conditions improve. It’s a win-win strategy for buyers looking to make the most of their timing and resources. By acting now, you’ll enjoy the stability of home ownership and position yourself for future financial benefits as rates decline.
The Right Time Is When You’re Ready
The most critical factor in buying a home isn’t necessarily the interest rate—it’s your personal readiness. Do you have a stable income? Are you ready to settle into a home and start building equity?
A Final Thought: Time Is Money!
Waiting to buy a home could cost you more than you think. Rising prices, continued rental expenses, and the uncertainty of interest rate movements mean you could miss out on building equity and wealth. If you’re ready to make the leap, the right home and a stable financial future are well within your reach today.
Don’t wait for the perfect moment—create it. Contact us to explore your home ownership options and start building your dream today.