We’ve been monitoring the market closely and discussing several topics that affect NYC homebuyers. So, whether you’re looking to buy a property now, or 3 years from now, this information should be insightful. Something we’ve learned about recently is a new strategy that sellers are using in order to make their properties more attractive. It’s called a “Rate Concession” or a “Buy-down in the Rate”. In short, the way it works is that if a property isn’t selling, some homeowners are offering a 2 point buy-down in the rate for the purchaser. This is much better than a price change because most of the time a buy down in the rate lowers the buyers monthly payment much more than a price change would.
So why are we telling you this? Because you as a buyer can also use this strategy. In other words, when you make an offer on a house, you can make your offer and include as part of your terms, “2 point buy-down in mortgage rate”. You will have to speak with your agent and lender to make sure that everything is structured properly, but if the seller agrees, this is a great way to lock in a lower mortgage rate and lower your monthly payment significantly. If you have any questions about this strategy, let me know.
The other thing we’ve been talking about lately is whether buyers should be looking to buy right now, or if they should wait until next year. The answer can be tricky, but it is also quite simple. In our opinion, whenever you’re in a position to buy (i.e. good income, good credit, consistent employment, down payment on hand, etc) you should always be looking to buy.
Something important to keep in mind is that you live on the monthly payment, not on the price. Mortgage rates are up, but as you can see above, there are strategies for that. One thing you can ask yourself is how long do I plan to own this property? If the answer is 10+ years, then price is almost irrelevant since 10+ years from now you can safely assume that the property value will most likely be up and to the right. On the other hand, if the answer is 3 years, 5 years, 7 years, etc. then you may want to be more cautious in this market as it is very hard to know where the market will be in the short term. That being said, as long as you’re comfortable with the monthly payment and have a fixed rate mortgage, you should be in a good position.
Something else I wanted to share with you was our most recent blog post. This one is about multi family investing and 5 tips for when you are looking to buy a multi family. Some pretty good tips here, and if you use them, you will ensure a more profitable and secure investment. Check it out when you have a chance and let me know if you have any questions.
Lastly, have you checked out our podcast lately? We’ve published several episodes in the last month or so that are specifically related to NYC homebuyers so if you’re looking to buy, or want to learn more about buying a home in NYC, check it out.
Well, that’s it for this month. Thanks for reading and for staying connected. As always, if you have any questions, need any advice, or could use some recommendations, please don’t hesitate to reach out!