Wating for home prices to go down will not save you anything if interest goes up!

Let us say that you can by a house today for $200,000 if you finance $200,000 for 30 years at 5% your principal and interest payment is $1,073.64 per month. If you keep the home the full 30 years and pay on schedule your total principal and interest pay back is $386,511.57

Now if the home value drops 10% to $180,000 and interest rises to 6% your principal and interest payment for a 30 year loan is $1,079.19. If you keep the home for 30 years and pay back on schedule your total principal and interest payback is $388,508.74

So for every 1% interest rates rise the sale price has to drop 10% for you to come close to breaking even. Stop by and talk with your banker, ask them to run the numbers for you. See what it will cost you if home prices do not drop lower and interest goes up.

If you are on the fence waiting to buy and hoping for prices to drop please keep a eye on the interest rates. How long will they stay this low. My guess is not that much longer?

We have some great deals in Dahlonega Georgia now so if you are looking for low prices combined with low interest rates for qualified borrowers now may just be the best time you will ever see in your lifetime.

By the way if home prices stay the same and interest goes up 1% that same $200,000 loan principal and interest payment went up to $1,199.10 per month and a 30 year total pay back for principal and interest went up to $431,676.38.