You Can’t Rent Forever, But You Absolutely Can And Should Rent For Now
The interest rate on a 30-year mortgage continues to climb. At last check, it was 7.6%. So much for that horrible advice — marry the house, date the rate — sleazy real estate agents have been giving prospective home buyers. When I wrote about this in March — more than six months ago — the payment on the typical home in America was $2,563. At that point, the rate was right at 7.0%. At the current rate amid a median home price of $420,846 and using the same input, the monthly payment has increased to $2,938. Believe it or not, as rates continue to rise, so does the cost of housing. That median price is actually up 3.0% from the same time last year.
This idea of marry the house, date the rate basically means get the house now because, um like, you love it and get rid of the high rate later when you refinance your mortgage at a lower interest rate.Prospective home buyers: We’re not sure. That’s a high payment. It is. But if you can manage it for a couple of years, housing prices will start going up again and rates will come down. You can refinance! Ah, okay, makes sense. We can stretch for a couple of years as long as we pay less after that.
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