Just about 2 years ago, my buddy was at my home and talking about the “townhome” he had purchased in St. George, Utah and told me I should take my family down sometime. I was super curious. He left and the thought kept at me – St. George! So, a couple of months later in January of 2021, still in the throes of COVID, I took my little family to St. George and we stayed in my buddy’s Airbnb. We loved it! In fact, we loved it so much that I put my mask on and went to the sales office and plopped down $15,000 for a deposit on a to-be-built 4 bedroom townhome, nightly rental approved. Last year at this time, I found myself in St. George, Utah moving brand new furniture I had accumulated in the months prior into a brand new Airbnb we had just closed on.
2021 was C-R-A-Z-Y! It was a year like no other I have ever experienced. We locked our price in January, but by completion in October, units had doubled in value. Builders everywhere were cancelling contracts and giving the earnest money back. They would put them back on the market and had bidding wars at double prices.
Let’s take a look at pricing during the past couple of years. We locked our prices in January and closed in October of 2021.
- Approx. $400,000 purchase price.
- Fixed interest rate of 2.7% for 30 years.
- Monthly Mortgage Payment of approximately $1,600.
Fast forward to October Homes with same layout as mine were now being sold for $750,000+. I scrambled to finalize my financing — at the threat of the builder cancelling our contract. Happy was the day that we finally signed on the line and picked up our keys.
- Approx. $750,000 purchase price.
- Fixed interest rate of 3% for 30 years.
- Monthly Mortgage Payment of approximately $3,162.
Fast forward another 1 year. Now the Fed has gone crazy raising interest rates to curb inflation. (Where were they last year when my real estate price doubled????)
- Approx $850,000 purchase price.
- Fixed interest rate of 7%.
- Monthly mortgage payment of $5,655.07.
You can’t predict the markets! Especially this one. We made a big step, and it paid off! Certainly we couldn’t afford that house now. So blessed that we locked it up when we did!
