Redfin agents have noticed a trend lately; couples are putting off their wedding so that they can buy a home. The reason? Low mortgage interest rates. These practical pairs haven’t given up on the idea of marriage, they just can’t afford to buy a home and pay for a wedding at the same time, and interest rates are too enticing right now.David Pollack, a real estate agent at Redfin, experienced this personally. “I bought my house with my girlfriend in October. We will get engaged eventually, but I told her I’d rather spend the money on a house right now. I’ve had three clients who have made the same decision; they want to lock in a good loan now while interest rates are low,” said Pollack. So are these couples making the right decision? Redfin decided to look at what couples could miss out on financially if they put off buying a home to have a wedding, or if you want to look at it the other way, what they gain financially if they forgo the wedding and buy a home.First of all, we gathered up some wedding statistics:
According to The Knot, the average wedding costs $28,427, not including the honeymoon or wedding bands
The Knot says wedding bands cost $1,126 for brides and $491 for grooms on average
The average newly married couple spends $5,111 on their honeymoon trip, according to a Conde Nast Bridal Infobank survey (cited in Bankrate.com)
All together, that’s about $35,000. If a couple instead used that $35,000 on a 20% down payment for a $175,000 home, over the course of five years the home would gain nearly $47,000 in equity (assuming an appreciation rate of 3%)
So if a couple spends their savings on a wedding and has to start over from scratch to save for a down payment, they could be losing out on nearly $47,000 over the course of five years.
Author:Leah Ecob Phone: 956-206-5577 Dated: March 4th 2014 Views: 1,433 About Leah: Originally from Laredo, TX Leah graduated from The Cox School of Business at Southern Methodist Univ...
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