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https://www.har.com/blogs/detail?id=118539&blogpreview=1
As much as we all hate to see interest rates here where they are now. To put things in perspective, I paid 13.5% interest on my first property purchased back in 1978. I wanted to buy a beautiful new house, at the time - I would have had to have spent around $90,000. Instead, I opted to buy a new 3/2 condo that was priced at $38,000. I stayed in that condo for 7.5 years until I purchased an actual single family dwelling.
The same thing can be accomplished by rolling back your price range. If you qualify to buy a $350,000 home, consider buying a $250,000 home that can be improved and sold again after 2 years for a NON-FEDERAL TAXED PROFIT.
A single person can do this every two years making up to a $250,000 profit without paying income tax on the profit. A married couple can do the same earning up to $500,000 in profit without paying federal income tax. The trick is, "you must not sell until AFTER 2 years.
Finding a home with good bones is important so that your money can be spent on the more profitable things such as "updates". If the home has a good roof, and a good HVAC system, no rotted wood, no foundation issues - then you can focus on the cosmetic items. Those are what I call "the fun items". Much more fun to add granite than to put up a new roof.
Using a lender who offers free future refinance should be part of your strategy.
I survived 13.5% interest, it was not fun but, I got it done. I started earning deduction from my federal taxes for interest and property taxes and I started earning equity.
Right here in the Clear Lake areas, condo's that sold for $60,000 just a few years ago have been selling for over $100,000 in recent times. Homes that used to sell for $160,000 in subdivisions like Middlebrook have recently sold for $300,000. Waiting for interest rates to go down is not the answer and even though prices may fall a bit, YOY they have done nothing but go up since 2012.
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