Don’t plan on refinancing anytime soon!

Don’t assume you will be able to refinance your mortgage rate soon. I am seeing a lot of people encouraging others to buy now and refinance later. You should only be buying a home if you can afford the monthly payment you are quoted. Do not assume you will be able to get a lower payment this year or next. Assuming you can refinance at a lower rate soon is a good way to become house poor and become that motivated seller that buyers are looking to take advantage of. Do not assume rates are going to go dramatically lower. The current rates in the market are closer to “normal” than anything we have seen in years. Just take a look at mortgage rates over the span of a couple decades and you will see what I mean.
Second, don’t assume home values will keep going up. Refinancing requires a house appraisal. What happens to your plan if the value of your house goes down? You will then need to come up with enough cash and/or equity to bring to the loan closing.
I would recommend that you purchase something that you can reasonably afford. If rates go down, then refinancing is a nice bonus.