Would you buy at 7.4% right now, or wait for rates and fight more buyers later?

Question

Sellers outnumber buyers by a record 63% nationally, and in 13 metros there are more than two sellers for every buyer. The catch is that rates are sitting around 7.4%.

One camp says buy the price now and refinance if rates ever drop. The other says wait, because a 7.4% payment kills the cash flow no matter how good the price is.

Which camp are you in? Best replies might show up in Thursday’s BiggerPockets Investor Brief Newsletter.

Chris Seveney · Answer

I hate this saying and disagree with it completely. How is it working for MF operators?

The real answer to the question above is "it depends". An owner occupied home vs. an investor home are two completely different things. If I was owner occupied I would not be buying right now as it most likely is cheaper to rent in most markets - (actually using an emdash and this is not chatgpt) but as an investor if the asset is a deal buy it.

Ametria Chaney · Answer

I'm in the buy-if-the-numbers-work camp, with one condition: the deal has to cash flow at today's rate, not at some hoped-for refi rate nobody can promise. Here's the part that doesn't get enough weight: in a market where sellers outnumber buyers, you have negotiating power — price reductions, repair credits, closing-cost concessions — that simply disappears when rates drop and competition floods back. Waiting for a lower rate usually means paying a higher price and fighting multiple offers, which can wipe out the payment savings. So run the numbers at 7.4%, negotiate hard on price and terms now, and treat any future refi as a bonus, not the plan. Are you looking at this as an investor or a primary residence? That changes the math quite a bit.

Tyler Mcclean · Answer

Marry the house date the rate.

Theresa Harris · Answer

In the US it seems really easy to refinance without penalties, so if you find a good place, buy it. Then if rates go down, refinance. The only thing I'd add is what do you expect the rates to be? If you are looking for rates like 10 years ago, that was not normal. They were very low and I wouldn't expect that to happen again.

Matthew Morrow · Answer

@Garrett Brown I'd buy if the deal works at today's rate, and I wouldn't buy one that only works after a refi, because nobody knows when rates move. With sellers outnumbering buyers, this is the stretch where you can actually negotiate price, repairs, and credits. That window usually closes once rates drop and everyone piles back in. The numbers would be my first concern, not the rate. Curious to hear how others are approaching it.

Would you buy at 7.4% right now, or wait for rates and fight more buyers later?

Would you buy at 7.4% right now, or wait for rates and fight more buyers later?

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