Golden Handcuffs for Homeowners
We've all heard the story of how little inventory is on the market right now. I'm not going to tell you more about what we already know.
If you aren't up to speed on the market, we covered that in our last blog: August Market Update: It's Not What You are Expecting
Current homeowners feel like they're wearing golden handcuffs. The handcuffs are sub 4% interest rates. Especially with those in the 2s and 3s.
There are a lot of people who would like to make a move, that feel like they can't.
Going from a 3% interest rate to a 7% interest rate is one thing, but home values are also higher as well.
Yet there are options for people in this position. One of the most powerful things you can do to build your wealth as a homeowner, is become a landlord.
If you have a mortgage under 4%, your mortgage payment is (probably) lower than what you'd be able to collect in rent.
When you take your primary home and make it a rental property, you keep your existing mortgage. This allows you to collect cash flow and allow someone else to pay off your mortgage.
Obviously this means that you'd have to move out of the home. Leading to you purchasing another property or event renting.
If you're able to qualify to buy your next home without selling your current home, you can do this. You want to make sure you're comfortable with the payments, but if you can, it's one of the best ways to build wealth.
We have a few tools to help you figure out if this is a possibility.
First, you'll want to find what you will be able to rent your property out for. If you don't have a good idea already, ask for a "Rental Analysis".
Next, you may want to play with a mortgage calculator, like this. Figure out your comfort zone for what you could buy without selling your current home.
Then, search for homes in that comfort zone range. If you see something you like, click schedule a tour.
You owe it to yourself to see if there is even a possibility to do it. Worse case scenario, the numbers don't make sense and you are in the same position as you are now.
If you want to make it really easy, call your agent and have them work the numbers and scenarios for you.
Not working with an Onyx Homes agent? You should be.
PS - If you do want to move and you do need to sell your current home, ask about our Buy BEFORE You Sell program. It works just like it sounds.