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You ask a very good question. I think it accurately frames what a good many homeowners may be pondering as they contemplate the current real estate market. They're enjoying a very low mortgage rate on their current home, which has seen a significant increase in equity, but they find that the home may no longer be adequately meeting their needs or wants. The result is they are "trapped" in their current home, which at one time met their needs, or they wouldn't have purchased it, but they now want, or need, to move up to a larger, nicer home. Does it make sense to "settle" with your current home that no longer meets your needs simply because of the low rate mortgage? Particularly given that decision is based on an educated guess, at best, as to when home prices will fall, if they do at all? My take is no, it may not be the best decision to settle. I truly believe the purchase of a home is, first and foremost, about what it does to adequately house you and your family in the manner and style that will make you most happy in a time horizon you prefer. The financing aspect, though important, should be secondary, in my opinion. So if you've concluded that purchasing a home that will better suit the needs of you and your family, and you'd like to meet those needs sooner than later, I think pursuing that purchase in the current market is a good call. But try to be strategic about it. If you think the Corcoran prediction is valid, there will be increased equity in your current home, should you keep it, or the new home you purchase now. If your current home has a mortgage at 2.50-3.00% and you'd like similar terms on a new home purchase, submitting offers asking for a seller credit for a temporary 2-1 or 3-2-1 buydown is a great strategy. It will give you a 1st year rate in the low 4's or 3's and it gives you 2-3 years of a below current market rate and payment to allow you time to look for an opportunity to refinance that note rate lower. And in the meantime, the new home you purchase now will likely see increased equity as those rates fall to present you that refinance opportunity.

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