Tag Archives: #interestrates

The High Cost of Waiting

You’ve been thinking about buying a home, but the current economic situation has you skittish. As predicted, Interest rates have inched up. But, they’re nowhere near what you’re currently paying on your credit cards.

Well-meaning relatives, who “know a little something about real estate,” and not so sincere talking heads on your favorite cable news channel are saying you should wait because sales prices are going to drop.

Level off?

Possibly.

Drop?

No.

So, here’s what waiting is costing you.

If you already owned a home, your net worth likely got a big boost thanks to rising home equity. Equity is the current value of your home minus what you owe on the loan. And today, based on recent home price appreciation, you would be building equity far faster than you would have expected. Here’s why.

Because there’s an ongoing imbalance between the number of homes available for sale and the number of buyers looking to make a purchase, home prices are on the rise. That means a home is worth more in today’s market because it’s in high demand. As Patrick Dodd, President and CEO of CoreLogicexplains: “Price growth is the key ingredient for the creation of home equity wealth…This has led to the largest one year gain in average home equity wealth for owners…”

Basically, because home values have climbed so much, equity has increased too. According to the latest Homeowner Equity Insights from CoreLogicthe average homeowner’s equity has grown by $64,000 over the last 12 months.

While that’s the nationwide number, the map below shows that average equity for Massachusetts homeowners has increased $62,000.

The Average Homeowner Gained $64K in Equity over the Past Year | MyKCM

The Opportunity Your Rising Home Equity Provides

Thinking about marketing your home and upsizing, downsizing or moving to that someday neighborhood? Your equity can help you purchase your next home. When you sell your current house, the equity you built up comes back to you in the sale. In a market where homeowners are gaining so much equity, it may be just what you need to cover a large portion – if not all – of the down payment on your next home.

So, if you’ve been holding off on selling or you’re worried about being priced out of your next home because of today’s ongoing home price appreciation, your equity can help fuel your move.

That’s what we just did. We took advantage of the equity in our home to downsize and purchase something smaller in an area that we’ve been looking at for years. We had no home sale contingency when we made our offer. We then sold our house and received $45,000 over asking price! You can do it, too!

Curious about your options? We’re happy to answer your questions. Let’s connect at 508-360-5664 or msennott@todayrealestate.com. We’ll share with you current market statistics, as well as our experiences as both buyers and sellers. Let’s talk soon.

Enjoy your week. It looks like summer is finally here!

Best regards,

Mari and Hank

How Homeownership Can Help Shield You from Inflation

If you follow the news, you know about inflation. You’re also likely feeling its impact in day-to-day life as prices go up for gas, groceries, and more. These rising consumer costs can put a pinch on your wallet and make you re-evaluate any big purchases you have planned to be sure that they’re still worthwhile.

If you’ve been thinking about purchasing a home this year, you’re probably wondering if you should continue down that path or if it makes sense to wait. While the answer depends on your situation, here’s how homeownership can help you combat the rising costs that come with inflation.

Homeownership Offers Stability and Security

Investopedia explains that during a period of high inflation, prices rise across the board. That’s true for things like food, entertainment, and other goods and services, even housing. Both rental prices and home prices are on the rise. So, as a buyer, how can you protect yourself from increasing costs? The answer lies in homeownership.

Buying a home allows you to stabilize what’s typically your biggest monthly expense: your housing cost. If you get a fixed-rate mortgage on your home, you lock in your monthly payment for the duration of your loan, often 15 to 30 years.

James Royal, Senior Wealth Management Reporter at Bankrate, says that a fixed rate mortgage allows you to maintain what is probably your largest monthly expense at the same level. While property taxes will rise and other expenses related to your home will creep up, your monthly housing payment will remain the same.

In other words, no calls from the landlord telling you that your rent is going up – again.

Use Home Price Appreciation to Your Benefit

While it’s true rising mortgage rates and home prices mean buying a house today costs more than it did a year ago, you still have an opportunity to set yourself up for a long-term win. Buying now lets you lock in at today’s rates and prices before both climb higher.

In inflationary times, it’s especially important to invest your money in an asset that traditionally holds or grows in value. The graph below shows how home price appreciation outperformed inflation in most decades going all the way back to the seventies – making homeownership a historically strong hedge against inflation (see graph below):

How Homeownership Can Help Shield You from Inflation | MyKCM

So, what does that mean for you?

Experts are saying home prices will continue to go up thanks to the ongoing imbalance in supply and demand. Once you buy a house, any home price appreciation that does occur will be good for your equity and your net worth. And since homes are typically assets that grow in value (even in inflationary times), you have peace of mind that history shows your investment is a strong one.

Curious about your options? Let’s connect at 508-360-5664 or msennott@todayrealestate.com to review a plan for you to buy and/or sell.

…and remember. We know of what we speak. We’re selling and buying now, too. Check out our series “Mari Makes the Move” on our YouTube Channel, Mari Sennott Plus.


We hope to see you this Saturday from 9am to Noon at the Today Real Estate parking lot at 299 Cotuit Road in Sandwich, where you can safely dispose of your important documents. Great White Shred will be there to shred your valuable paperwork that contain personal information.

Stephanie (Viva) in the Morning from 102.3FM will be there spinning your favorites and we’re joining with Kristi Sassone from First Home Mortgage to provide Cape Cod Coffee and donuts.

Limit of ten boxes of material to be shredded, please.

See you there!

Mari and Hank