Most buyers approaching the Los Gatos market share a common concern right now: home prices and mortgage rates have both risen, making the purchase feel harder than it looked a year ago. But here is what the data actually shows. Costs have increased, yet affordability measured against average wages still falls within the range most lenders consider manageable. That gap between perception and reality is worth exploring before you decide to wait.

You know how you keep hearing that it is a “bad time to buy”? And then you look at rental prices climbing every single year and wonder whether waiting actually saves you anything? A lot of buyers in Los Gatos are sitting with exactly that tension right now. But here is the part most people have not stopped to think about yet: the two choices you think you have (buy now or wait) both come with a cost. The question is which cost you are choosing.

Diving Deep Into What the Numbers Are Actually Saying

Fannie Mae’s Home Purchase Sentiment Index recently found that 64% of Americans believe it is a bad time to buy a home. That number was 38% just a year earlier. What is driving that shift? Mostly two things: home prices have risen sharply, and mortgage rates have moved higher off historic lows.

What does your housing situation actually look like right now? Are you renting month to month? Are you watching your rent increase and telling yourself next year will be a better time to buy?

Here is something worth sitting with. ATTOM Data found that major homeownership costs on a typical home now represent about 25% of average national wages. That number is up from 22% the prior year. Todd Teta, Chief Product Officer at ATTOM, notes that average workers can still manage the major expenses of owning a home, based on lender standards. The standard most lenders prefer is 28%. The market is approaching that line, but it has not crossed it.

And when you adjust for inflation, today’s average mortgage payments are actually about 10.7% lower than they were in 1990. Does that change how you are thinking about this?

Today’s Biggest Buyer Question: What Does Renting Actually Cost You?

Have you ever stopped to think about what happens to the money you spend on rent every single month? Not just this month. Every month for the next five years?

According to the National Rent Report from Apartment List, rental prices rose 9.2% in just the first half of one recent year. In a typical year, that growth is 2% to 3%. Rent is not holding steady while you wait. It is accelerating.

If you continue renting in a market like Los Gatos, where demand for housing consistently outpaces supply, what does that trajectory look like in three years? Your rent climbs. Your savings toward a down payment compete with that climbing rent. And the home you could buy today is priced higher by the time you are ready.

That is not a scare tactic. That is just math worth running before you make the choice to wait.

Are You Diving Deep Into the “Wait It Out” Option?

Some buyers tell themselves they will wait a year and see if prices come down. Let’s look at what diving deep into that assumption actually reveals.

A monthly mortgage payment is determined by two variables: home price and interest rate. For your payment to drop by waiting, one of those two has to fall. Here is what major forecasting organizations were projecting at the time this data was gathered. The Mortgage Bankers Association projected rates moving to around 4.2% by year’s end. The Home Price Expectation Survey, drawing on over 100 economists and analysts, projected home prices rising another 5.12% in the following year.

If both of those projections hold, the buyer who waits would face a higher purchase price, a larger required down payment, and an additional cost of roughly $3,696 per year over the life of the loan. Can you see how the “wait and save money” plan might actually cost more than it saves?

What would it mean for your family if you could lock in a payment today that never changes, instead of watching both your rent and local home prices climb over the next few years? That is the trade-off worth thinking through.

Diving Deep Into Your Actual Options

Mark Fleming, Chief Economist at First American, put it plainly: “Affordability is likely to worsen before it improves.” That is not a sales pitch. That is a forecast from an economist with no stake in your individual decision.

The question is not whether you missed the absolute low point in the market. Most buyers always do. The question is what happens if nothing changes in your current situation. If you keep renting for the next three to five years in a market where rents are climbing and home prices are projected to rise, where does that actually leave you?

That is a question worth sitting with. Not to pressure yourself into a decision, but to make sure the choice to wait is a conscious one with its costs fully understood, not just a default.

The Los Gatos real estate market moves at a pace that rewards preparation. Buyers who understand their pre-approval range, their realistic down payment timeline, and the actual monthly cost difference between buying and renting are making decisions from a position of clarity rather than anxiety.

If you would like to run those numbers for your specific situation, Timothy Alston, Broker (DRE# 01328224), is available for a straightforward conversation. Not a pitch. Just a clear look at where you are and what your options actually cost. You can reach him directly at (408) 207-4593. Would that kind of conversation be useful to you right now?