Sitting on the Fence is Getting Expensive

You’d better pay attention if you’re looking at buying a home. The market is likely to change in the next twelve months and is already very different than the way it was last year. Take a look at these stats so you’ll be better informed to plan for the upcoming year. We’ve used the date from the Intermountain MLS (covering SW Idaho) to establish average price and Freddie Mac’s Primary Mortgage Market Survey to get the mortgage rate. We also assumed a 3.5% down payment in all examples.

Last Year:

Around this time last year, the median price of a home selling in SW Idaho was $154,400. The interest rate for a 30-year fixed mortgage was at 3.5%. This is what it cost to buy a home last year:

Today:

Today the median price of a home in SW Idaho has gone up to $182,900, with the interest rate of a 30-year fixed mortgage being 4.5%.

The monthly cost has already gone up $225.23 from last year!

Next Year:

While predicting the future of real estate can be tenuous, we’ve used information gathered from over 100 housing experts who were surveyed in the Home Price Expectation Survey in order to project future pricing. Over the next twelve months, they are expecting an appreciation rate of about 5%. To establish the predicted interest rate, we’ve averaged the projections from Freddie Mac, Fannie Mae and the Mortgage Banker’s Association. Here is what they came up with for the relative costs of a home one year from now:

The monthly costs will go up about $100!

What This Means for You

If you've been planning to buy a house, you’d better get it now before you are priced out of the house you really want.