Should You Wait to Buy in Arlington?

If you’re thinking about buying a home in Arlington right now, there’s a pretty good chance interest rates are giving you pause.

We get it.

Mortgage rates are hovering around 7%, and when you’re looking at a $1 million home, that number matters.

But after years of helping people buy and sell homes in Arlington, we’ve learned that focusing on the interest rate alone can give you a very incomplete picture.

The question we would ask isn’t simply, “Should I wait for rates to come down?”

We would ask:

What does buying today look like compared with waiting another year or two?

That is a much more useful conversation.

Let’s Put Real Numbers to a $1 Million Arlington Home

Let’s say you purchase a $1,000,000 home with 20% down.

Your mortgage would be $800,000.

At a 6.95% interest rate, principal and interest would be approximately $5,296 per month.

At 6.26%, it would be approximately $4,931 per month.

That’s a difference of about $365 a month.

Of course $365 matters.

But here is the part we think buyers sometimes overlook.

If you wait for that lower rate, will the same house still cost $1 million?

Will there be more buyers competing for it?

Will you have the same ability to negotiate the price or terms?

Nobody knows.

That’s why we think buyers need to look at the whole picture instead of trying to time one number.

There Really Is No Single “Arlington Market”

This is one of the most important things we tell our clients.

Arlington is only 26 square miles, but the real estate markets within those 26 square miles can behave very differently.

A $1 million buyer looking in 22202 Aurora Highlands may have a completely different experience from a $1 million buyer looking in 22207 Chair Bridge Forest.

The market for a condo in Rosslyn or Ballston can look very different from the market for a townhouse in South Arlington.

Even two detached homes at the same price can attract completely different levels of competition depending on the neighborhood, condition, lot, schools, walkability and proximity to Metro.

That’s why national headlines about “the housing market” don't tell us very much.

We want to know what is happening in your market.

What type of property are you buying?

What neighborhoods are you considering?

What is happening around your particular price point?

That is the information that should help drive the decision.

Today’s Market Can Give Buyers Something We Haven’t Always Had

Time.

We have worked through markets where buyers barely had time to think.

A house would hit the market on Thursday. Offers were due Monday. There might be 10 or 15 offers. Buyers were waiving inspections, waiving appraisals and escalating well beyond the asking price.

The interest rates were fantastic.

The buying conditions often weren't.

Today, depending on the property and neighborhood, buyers may have opportunities that simply weren't available during those years.

You may be able to keep an inspection contingency.

You may be able to negotiate repairs.

You may be able to ask for a closing cost credit.

You may even be able to negotiate the sales price.

And sometimes you can actually see the house twice before deciding whether you want to buy it.

That has value.

We would never suggest buying a house simply because there is less competition. But we also wouldn't dismiss the advantage of being able to make a thoughtful decision and negotiate terms that protect you.

If You’re Renting While You Wait, Include That in the Math

Waiting has a cost too.

Let’s say you’re paying $3,300 per month in rent.

That’s $39,600 per year.

Over three years, that’s $118,800, assuming your rent never increases.

Renting can absolutely be the right decision. It gives you flexibility, and there are times in life when that flexibility is worth every penny.

But if you already know you want to own a home and you're renting primarily because you're waiting for interest rates to improve, then those rent payments need to be part of your calculation.

Waiting isn't necessarily the cheaper option.

Now Let’s Look at Ownership

Go back to our hypothetical $1 million purchase with 20% down and a 6.95% mortgage.

During the first year, you would pay down approximately $8,200 of your mortgage principal.

That number grows over time as more of each payment begins going toward principal.

Of course, owning a home costs money too.

There are property taxes, insurance, maintenance and mortgage interest.

We never want buyers looking at homeownership as though every dollar they spend becomes equity. It doesn't.

But there is an important difference.

Part of your monthly payment is gradually reducing the amount you owe on an asset that belongs to you.

Over time, that can become meaningful.

What About Appreciation?

This is where we are very careful with clients.

Nobody can guarantee that your house will appreciate.

Real estate values can go up and down, and individual properties can perform very differently.

But time is an important part of the homeownership equation.

For illustration, if a $1 million property appreciated an average of 3% per year, after seven years it would be worth approximately $1.23 million.

That would represent roughly $230,000 in appreciation before selling costs and other expenses.

That is not a prediction of what your Arlington home will do.

It simply demonstrates why we encourage buyers to think beyond this month's interest rate.

A house is usually a long term purchase.

The seven year picture can look very different from the first year picture.

Why Arlington Continues to Be Different

We are admittedly a little biased about Arlington. We live here, work here and sell homes here every day.

But there are also very practical reasons Arlington remains such a desirable place to own real estate.

We have extremely limited land.

We are minutes from Washington, D.C.

We have Metro access, Reagan National Airport, the Pentagon, National Landing, parks, trails, established neighborhoods and major employment centers all within a remarkably small geographic area.

And while Arlington continues to grow and change, there is one thing nobody can change.

We can't make more Arlington.

That does not mean every house is a great investment.

It does not mean prices can't decline.

And it certainly doesn't mean you should buy anything just because it is located in Arlington.

The property still matters.

The neighborhood matters.

The price you pay matters.

The condition of the house matters.

And how long you expect to own it matters.

That is exactly why local knowledge is so important.

We Don’t Believe in Buying Based on a Future Refinance

You've probably heard the saying, “Marry the house and date the rate.”

We don't particularly love it.

We prefer something much simpler:

Buy the right house at a payment you can comfortably afford today.

If interest rates fall enough in the future and refinancing makes financial sense, wonderful.

But that should be the bonus, not the plan.

We would never advise a client to stretch beyond a comfortable monthly payment because someone told them they could refinance later.

You don't know what rates will do.

Buy based on the numbers you know today.

So, Is Now the Right Time to Buy?

Sometimes yes.

Sometimes no.

And that's probably not the answer you'd expect from two Realtors.

If buying a home would drain your savings, we would tell you to wait.

If you're probably moving again in two years, we would want to look very carefully at whether buying makes sense.

If the monthly payment makes you uncomfortable, we would rather help you find a different house or adjust your price range.

But if you have stable income, adequate savings, plan to stay for several years and can comfortably afford the payment, we wouldn't let the interest rate alone make the decision for you.

There is almost always a tradeoff in real estate.

When rates are low, more buyers may enter the market.

When competition is lower, financing may be more expensive.

When everyone suddenly feels confident about buying, you're probably going to have more people standing next to you at the open house.

The goal isn't to find the perfect market.

The goal is to recognize the right opportunity for you.

Let’s Look at YOUR Arlington Market

This is where we think local real estate advice really matters.

Instead of asking, “Is this a good time to buy a house?” we would rather help you answer:

Is this a good time for me to buy this type of home, in this Arlington neighborhood, at this price and on these terms?

Those are two completely different questions.

Tell us the neighborhoods you're considering, your approximate price range and what you're hoping to find.

We can show you what is actually happening there.

What are homes selling for?

How long are they taking to sell?

Where are buyers negotiating?

Where are multiple offers still happening?

And most importantly, what does the math look like for you?

Once you have that information, you can make a decision based on your life and your numbers instead of trying to predict the next headline.

Geva & Jane | Varity Homes

Local knowledge. Straight answers. A strategy built around you.