Waiting is a decision too.

Nobody waiting for a lower rate thinks of it as a decision. It is one, and it has a price.

On 16 September the Federal Reserve raised its benchmark rate for the first time since 2023 and signaled that more increases may follow. This week the average 30 year mortgage reached 7.28 percent, the highest in nearly three years and almost a full point above where it stood a year ago. The instinct is to pause until it comes back down. That instinct is reasonable. It is also a position on the future, taken without anyone writing down what it costs.

Why this issue is about waiting

Issue 01 argued that the first question is not whether this is the right time but how long you intend to stay. This issue takes up the question almost everyone asks next. If rates are high, should I wait?

Sometimes the answer is yes. My job is to show you exactly when, and to make sure the choice to wait is made with the same rigor as the choice to buy.

Two clients, one assumption.

Both of these are real patterns I am seeing this season. Both people believe they are standing still. Neither one is.

The buyer waiting for a cut

She was approved in the spring at a little over six percent and found the right apartment in August. Then rates moved and she stepped back to wait for them to fall. She is paying rent while she waits, in a Manhattan market where the median rent is 7 percent higher than a year ago. She thinks of the pause as free. It is costing her a month of rent at a time, and it is betting on two things at once: that rates fall and that prices do not rise while they do.

The seller waiting for buyers to return

He was ready to list in September and decided to hold until spring, when he expects rates to ease and buyers to come back. Every month he holds, he pays the carrying costs of an apartment he has already decided to leave. He is also assuming the buyers he is waiting for will arrive able to pay what he wants. At today’s rates the same monthly payment buys roughly nine percent less apartment than it did a year ago. Waiting does not change that arithmetic. It only postpones the moment he has to meet it.

What is actually missing

Neither of them is wrong to be cautious. What is missing is a price on the caution. Each has treated waiting as the neutral choice and buying or selling as the risky one, when both are positions with costs attached. Only one of those costs is visible.

That is the asymmetry this issue is built on. If you buy and rates fall, you can refinance. It is not free in New York, but it is possible. If you wait and prices rise, no refinance gives that back.

The exhibit: what a year of waiting must earn back

Take the same apartment as Issue 01. A $1,500,000 Manhattan resale condominium, purchased with eighty percent financing. Bought today at 7.28 percent, the monthly principal and interest is $8,211.

Now wait a year. Suppose rates fall half a point, to 6.78 percent, exactly as hoped. The monthly payment falls, but only if the price stayed put. If the price rose while you waited, you borrow more, pay more mansion and mortgage recording tax, and keep a smaller share of the saving. The question is how long the lower payment takes to repay the higher price.

At one percent appreciation, a half point cut repays the year of waiting in 3.9 years. At two percent, 10.4 years. At three percent, 22.7 years. At four or five percent, it never does within the life of a thirty year loan.

If prices are flat, waiting wins outright: a half point cut saves $403 a month with nothing to repay. That is the honest case for waiting, and it depends entirely on a variable nobody controls.

How I price the wait

Four moves. As in Issue 01, the order is the part that matters.

• Name what you are actually waiting for. A lower rate, a lower price, more inventory, or more certainty. They are different bets and they rarely arrive together. Lower rates tend to bring more buyers, and more buyers tend to firm prices. Waiting for both is waiting for the market to make an exception for you.
• Put a number on the wait. Rent or carrying costs per month, plus the price risk, set against the payment you hope to save. If you cannot write that number down, you are not waiting, you are postponing.
• Separate the rate from the price. The rate is something you can revisit. A refinance in New York carries real costs, including a new mortgage recording tax, though a CEMA can reduce it substantially. The price is something you can never revisit. When the two pull in opposite directions, the permanent one deserves more of your attention.
• Set the trigger in advance. Decide now what would make you act. A specific rate, a specific price, or a specific apartment. A wait with a trigger is a strategy. A wait without one is a mood.

For buyers

If you are staying seven years or longer, the rate you lock today is unlikely to be the rate you carry for the whole hold, and the price you pay is permanent. That favors negotiating hard on price now, while higher rates have thinned the competition, over waiting for a cut that will bring the competition back. If your horizon is three years or less, Issue 01 still governs: the arithmetic is unforgiving, and continuing to rent is a legitimate answer.

For sellers

Higher rates shrink what a buyer’s monthly budget can carry. That is real, and pretending otherwise produces the overpriced listing that sits. But the buyers active today are the ones with conviction, and many will refinance later if rates allow. Pricing to the market that exists, rather than the one you expect in spring, usually beats the carrying cost of waiting for it. If you do not need to sell, waiting is a legitimate answer here too. Just choose it on purpose.

What that sounds like in the room

It sounds like me telling a buyer that if prices stay flat, she should wait, and showing her the math that proves it. It sounds like asking a seller what each month of carrying costs him, writing the figure on the page, and then asking what the spring would have to deliver to beat it.

The line I am watching

The 10 year Treasury yield. Mortgage rates follow it more closely than they follow the Federal Reserve, and the recent climb in mortgage rates has tracked rising Treasury yields. If the 10 year turns down decisively, the case for a near term rate reprieve strengthens. Until it does, the half point cut in this issue’s exhibit is a hope, not a plan.