Waiting for 3%? Why That Era Is Over and How to Win in Today’s Market
A lot of buyers and sellers have been pumping the brakes and hoping that mortgage rates drop back to 3%. I get asked all the time if that’s going to happen. The short answer is no. Those 3 and even many 4 percent rates were historic lows that appeared during the slow, stimulus-driven economy of 2020 and the spillover into 2021. They were a reaction to a very specific moment.
When that stimulus overheated demand, inflation took off. Everyone has felt it, including in-home prices. Ultra-low rates would only push inflation harder. That is why policy has focused on cooling things down. Nobody is trying to tank housing. The goal is to keep inflation in check and avoid bigger problems.
Where Rates Are Now
Today’s environment is generally high 5’s to low 6’s for many qualified buyers. That is normal by historical standards. My first few homes were financed in the fives and sixes. It just takes time for people to forget the pandemic-era anomaly.
If you have a very low current rate, it can be smart to keep it. If you also need to move, you still have options that can put you into an attractive rate on the next home. That is where strategy matters.
The Real Cost of Waiting
Price movement in the Charleston Tri-County area varies by location. Some neighborhoods are seeing double-digit appreciation. Others are closer to 2 to 3 percent. Either way, waiting has a price.
- Median price around $500,000
- 10% appreciation in a year adds about $50,000 to your
purchase price - 3% appreciation adds about $15,000
If you wait one to three years for rates to drop into the low 4’s, you could face an extra $50,000 to $150,000 in purchase price depending on area and timeframe. Financing a much higher price can erase much of the benefit of a slightly lower rate.
Right now, many sellers are negotiable. Inventory sits longer, which creates leverage for buyers. When rates drift lower and drop below 6%, many would-be movers plan to jump back in. That is when you tend to see multiple offers and faster price hikes. Acting before the crowd can put you in a stronger position.
Two Ways We Help You Beat the Market
We run programs designed to give you both a strong price and a comfortable payment.
1) Guaranteed 4% Interest Rate Program
For qualified buyers, we can structure a path into a rate in the fours. The exact approach depends on your profile and the property. Common tools include:
- Permanent rate buy-downs
- 3-2-1 or 2-1 temporary buy-downs
- Lender credits and seller concessions we negotiate on
your behalf
The goal is simple. Use the market we have today to secure a better price, then use incentives and smart financing to deliver a payment you are happy with.
2) Sell Your Home, Keep Your Rate
If you are selling and sitting on a great mortgage, ask about our Sell Your Home, Keep Your Rate program. We help you transition into a comparable rate on your next home when you qualify. Every situation is different, so we will walk you through options and lay out the numbers clearly.
Why Buying Now Can Still Win
- You can negotiate today. More days on market often means better terms, credits,
and repairs. - You can refinance tomorrow. If rates drift lower in the next year or two, you can
refinance and keep the equity gains you captured by buying earlier. - You build net worth sooner. Even a modest 3% appreciation on a $500,000 home is
about $15,000 in one year. Add principal pay down and you are moving in
the right direction.
Who This Helps The Most
- First-time buyers who want to avoid bidding wars and
lock a fair price - Move-up buyers who need space for a growing family
- Downsizers who prefer to capture equity now while
negotiating favorable terms - Anyone relocating for work or lifestyle reasons who
would move if payments made sense
A Simple Plan
- Call us for a strategy session. We will learn your goals, budget, and timing.
- See your numbers. We will map out pricing in your target areas, expected appreciation ranges, and today’s payment options, including buy-down scenarios.
- Negotiate from strength. We target properties with room to deal so you land a better price and the concessions that support your rate.
- Revisit when rates move. If rates drop later, we will help you evaluate a refinance so you keep the upside.
Bottom Line
Three percent rates were a one-off event. Life is still moving. Families grow, jobs change, and needs evolve. You do not have to choose between the wrong house and the wrong payment. With the right strategy, you can buy well today, lock a payment you like, and still benefit if rates ease later.
Go to davefriedmanteam.com, click the links below or call us at (843) 972-3833 and we'll be happy to share more options with you and explain to you how to get this strategy done. Thank you so much.