I Want To Buy a House but the Prices and Mortgage Rates Are Expensive. Should I Stay Patient?

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The housing market has been challenging for people in the market since the tail end of 2021.

Prices skyrocketed late in 2021 and early in 2022.

Bidding wars well above list price, and cash offers, became commonplace. Interest rates sat at historic lows. A COVID-19 supply crunch in terms of building materials and construction limited inventory. And the United States government pumped money into the economy, leaving many Americans flush with cash.

However, all of that came to a screeching halt once the Federal Reserve started attacking inflation that grew out of control. The entire economy shifted. Home prices stalled out. The average mortgage rate soared from 3.2% in January 2022 to 7.1% in October 2022.

Home prices have barely budged. With much higher mortgage rates, monthly payments cost even more than they did at the height of the pandemic. And homeowners locked into mortgage loans with less than 3% interest don’t want to sell.

If you’re in the market to buy a house, should you make a painful decision to buy, or should you be patient?

That’s what a listener of the Clark Howard Podcast recently asked.

Should I Buy a House Now or Be Patient and Wait for a Better Deal?

Should I wait to buy a house? Or will patience fail to score me a better deal on a home price or mortgage rates?

That’s what a Clark listener wanted to know on the March 27 podcast episode.

Asked Javier in Maryland: “We have $120,000 saved up for a home in Maryland. We couldn’t find a house during the big run-up because everyone was going crazy bidding up the houses. Now, even though interest rates are much higher, home prices haven’t come down. The houses are even more expensive with higher mortgage payments and we’re feeling like it’s not worth it.

“Do you think the housing market will get better any time soon? Will being patient pay off? Renting is not that much better in terms of cost but at least it gives us flexibility.”

Home values are declining in some markets in the United States, Clark says. But not by enough to counteract the higher interest rates.


“We have outrun most people’s ability to afford a home that are trying to buy one. The marketplace ultimately corrects for that,” Clark says.

“The way it [corrects] this time is going to be different than a normal environment. Because so many of the people in these homes have ultra-low mortgages. They’re not moving. Because they’d have to go from having a 2 or 3% mortgage to 6% or so.

“So people are saying, ‘Hey, I’m not going anywhere.’ So there are very, very few homes for sale. And we’re kind of in this standoff right now.”

Clark’s Verdict: Buy Now or Stay Patient?

How will that standoff end? Will home prices start to slide in a significant way? Or should Javier clench his jaw and press the buy button now?

“What will happen over time as we have normal economic growth, home prices will likely trail economic growth and activity,” Clark says.

“So it doesn’t mean that prices will go down. But over time, people will have different needs and circumstances [causing them to] sell even though they’re giving up their cheap mortgages. There will [also] be new inventory built.”

Patience will pay off for Javier, Clark says. Just not as fast as you may think — or in the way you may imagine.

“This is a terrible time [to buy] right now,” Clark says. “But the prospects in the future are better.”

Consider Building a New Home Instead of Buying Used

Much like the vehicle market, Clark almost always recommends that you buy used rather than new. The typical value equation may be turned upside down right now, though.

“I always tell you to buy used homes. Because they’re much cheaper per square foot. But right now, new home builders have inventory they must sell,” Clark says.

“New home builders aren’t necessarily cutting the price, but they’re improving the terms. Maybe buying down the mortgage rate for the entire 30 years of the mortgage. In which case what you’re paying is effectively much less per month.”

In other words, you may be able to snag an effective interest rate that’s significantly cheaper than the going market rate.

The bottom line remains, though. If you want to play the odds, being patient should eventually pay off. You may have to wait out people who want to move but are locked into mortgages with terrific interest rates.


“It’s a very, very hard time to be a buyer and a difficult time for most people to be sellers,” Clark says.

Final Thoughts

Should you wait to buy a house? That’s a personal decision.

For now, though, don’t expect a major collapse in home prices. They’re already declining in some markets. But Clark predicts the prices will start to climb again, although slowly, in the not-so-distant future.

At some point, people locked into great mortgage rates will abandon them for personal circumstances. Builders will continue adding new supply to the market. And interest rates may eventually come down a bit as well.

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