3 Reasons Why NOW is the Time to MOVE UP

Feeling the squeeze after 3 months of everyone working from home? Have you been dreaming of that home where everyone has their own space, the kids can run and play outside and you can enjoy a little quiet?

I have some GREAT news... NOW is the very best time I've ever seen to make that move into your next home and here are the 3 reasons why: 

1) INTEREST RATES ARE BELOW 3%! 

This means a huge purchasing power increase for everyone, but especially higher-end buyers. For every 1% the interest rates go down, purchasing power goes up by 11%! On top of that, the amount you pay down each month towards your principal goes up as well. The lower the interest rate, the faster you build up equity this way through principal reduction. Have you heard that you pay mostly interest on your mortgage payment for the first 15 years? At a 3% interest rate, you begin to pay the same amount of interest and principal at year 6! On a $350K home with 5% down, you save 67K in interest over the life of the loan if you purchase a home with a 3% interest rate vs. a 4% interest rate. It’s worth it to talk to a realtor and lender to see how much home you can afford (it may be more than you think!).  

2) YOU HAVE EQUITY!

If you purchase a home in the past 5 years, it’s possible you have well over 100K in equity (get your home value here to find out)!  You heard me right, 100K! This means you could purchase your next property and be able to put down that 20% and avoid mortgage insurance. This helps keep your payment lower, so your monthly payments may end up being a lot lower than you expected on a much larger home! 

3) YOU HAVE LEVERAGE!

Entry-level homes are hard to come by these days. Inventory is down 20% last 2019, and homes under 400K are seeing multiple offers and offers well over ask. What does that mean for you? It means that when you sell, you can ask the buyers of your home to offer you a rent back, ora longer close, so you can take time to look for a new home. In real estate, timing is everything, and that includes timing your move so you only have to move once! 

I said I was going to give you 3 reasons, but I came up with one more that you may not have considered…  

4) GREATER EQUITY GROWTH

A larger asset grows equity at a higher rate, so in the long run, you may end up building more wealth by owning a larger home. For example, if you have a 300K home that increases in value by an average of 5% a year, you build $15,000 in equity each year. If you have a 600K asset that appreciates by 5% a year, you build $30,000 in equity each year. This difference could cover the difference in your monthly mortgage payment!

Moving up may not be the best decision for everyone, so that is why WE SHOULD TALK. I would love to go over your specific circumstance and see if this makes sense for you right now. And remember, however you use as your realtor, make sure they have your best interest in mind, and that they help you meet YOUR real estate and financial goals! 

Your Utah Real Estate Resource,

Emily Hayes