Why Waiting for Mortgage Rates to Drop Could Cost You More Than You Realize
We regularly have this conversation with buyers across South Jersey and the Philadelphia suburbs.
They’re watching mortgage rates closely. They remember the 3–4% years. And they’re hoping to see rates drop again before they make a move.
I completely understand that mindset, however here’s the honest truth I share with my own clients:
Waiting for mortgage rates to drop could quietly cost you more than buying now.
Let’s walk through why.
Where Mortgage Rates Are Today (And What Buyers Need to Know)
Mortgage rates recently hit a three-year low, hovering around 6.2% (As of this writing 1/16/26). While that may still feel high compared to the historic lows of the past, it’s important to put this into perspective.
Historically, mortgage rates in the 6% range were very common before the 2008 housing crash. Many economists and housing experts now believe this is the range we’re likely to see through 2026 and possibly beyond.
Could rates fluctuate? Absolutely.
But waiting for a return to 3% interest rates is not a realistic buying strategy.
What’s Happening in the South Jersey & Philadelphia Housing Market
While buyers wait for rates to fall, something else continues to happen locally:
Home prices are still rising in many South Jersey and Philadelphia-area neighborhoods.
In communities like Collingswood, Haddonfield, Haddon Township, and throughout the Philadelphia suburbs, demand remains strong for well-located, move-in ready homes. Even modest price appreciation can significantly impact monthly payments over time.
Trying to time the market often means competing with higher prices later… and losing purchasing power in the process.
Why Waiting Can Cost More: Let’s Look at the Numbers
Here’s an example:
Home Price: $450,000
Down Payment: 20%
January 2025
Interest Rate: 7.1%
Principal & Interest Payment: $2,431/month
January 2026
Interest Rate: 6.15%
Principal & Interest Payment: $2,193/month
That’s a savings of over $200 per month without changing the home price, loan type, or down payment.
Now here’s where waiting becomes risky…
Same Rate, Higher Price = Higher Monthly Payment
Let’s assume mortgage rates stay exactly the same through 2027, but home prices increase by a modest 2%.
That same $450,000 home becomes a $459,000 home and now comes with a monthly payment of approximately $2,237/month.
Same mortgage rate. Same home.
Higher payment simply because of timing and inflation.
The Option Buyers May Forget: Refinancing
One of the most common things we hear from hopeful buyers is:
“I’ll buy once rates drop.”
Here’s what’s often overlooked:
If rates drop after you buy, you may have an option to refinance
If prices rise while you wait, you can’t undo the purchase price
Buying a home that fits comfortably within your monthly budget today gives you flexibility in the future. Waiting removes that flexibility. Having a conversation with your Lender and Realtor will help you better understand the numbers and help you to proceed with an educated strategy instead of a risky gamble.
The Mindset Shift Smart Buyers Are Making
Instead of focusing solely on interest rates or purchase prices, I encourage buyers to focus on one key number:
Your Monthly Payment
When life tells you it’s time to move… whether that means needing more/less space, a career shift , or a lifestyle change… the smartest approach is to:
Review your monthly budget
Identify a monthly payment you’re comfortable with
Work with a lender to calculate a budget, based on current rates, that will keep you in that comfort zone
Focus your search within that range
Rates will change. Markets will shift. However, buying a home that fits your life today creates long-term stability.
Thinking About a Move in South Jersey or Philadelphia This Year?
If you’re considering a move in 2026 — whether buying your first home, moving up, or relocating within South Jersey or the Philadelphia area — our team is here to help you make informed, confident decisions.
We’re always happy to:
Direct you to local lenders
Analyze local market conditions
Provide resources to help with your research
Help you understand your buying power
Sometimes clarity comes from simply seeing the numbers laid out.
If you’re on the fence, reach out to our team to start the conversation.
A clear plan beats waiting!