It’s also noteworthy to look at interest rates over the last decade. While the 2% and 3% rates of 2020–2021 created uniquely favorable purchasing power, a 5% to 7% rate is more in line with the U.S. historical average. And as NAR Chief Economist Lawrence Yun recently told Minnesota Realtors®, don’t expect to see interest rates that low again for at least the next 30–40 years.
Of course, it’s going to hurt your clients to consider what they could have saved by locking in at a 3% 30-year fixed mortgage rate versus, say, a 6% rate. The jump in monthly payment isn’t something to brush over. At the same time, however, if home prices continue to climb—as history all but guarantees they will—then waiting is a losing game too.
In summary, homeownership is one of the most secure investments one can make over the long term. Providing clients with simple data can help them make wise decisions for themselves and their families. Rather than being tossed to and fro by sensational headlines in the day-to-day housing market, it’s best to let the historic numbers speak for themselves.