Date The Rate, Marry The House!
Updated: Dec 13, 2022
Here are my thoughts on real estate in general over the last 15 years of being a homeowner, investor and Realtor.
Rates go up and down throughout the years. You're looking to find a house that you can make your home. If you continue to rent, your interest rate is 100%, instead of today's rate of about 6% — and you will be paying someone else's mortgage instead of your own.
When I purchased my first house in California I paid one of the highest prices in the neighborhood in 2007. My interest rate was 6.25% or 6.375% for a 30-year fixed. Over the course of the next two years through the foreclosure and short sale marketplace, the value dropped in half. Yikes! And interest rates since then had dropped below 2.5%.
In this case, I MARRIED THE HOUSE and dated the rate.
After a few years, I was able to refi the rate. And during that time, I had a roof over my head, and a house that I loved, where I was able to raise my kids, knowing that my monthly payment would never change.
Since 2007, the value of my house has nearly doubled, my interest rate is now fixed at about 3.25%, and I shaved off almost 6 years of mortgage payments by paying an additional $50 to $200 more per month on my mortgage balance instead of buying Starbucks, a new purse, or some great looking shoes!
Typically, I’m a private person, but I share these personal stories with you because buying a home to live in is not like buying stocks, bonds or crypto. Purchasing this asset puts a roof over your head, builds equity over time, and the real estate values in California have increased over the last 30 years, even thought there are up and down periods in the market.
Again, you are MARRYING THE HOUSE AND ONLY DATING THE RATE.
Until next time….