“Should I buy a house now?” Those are the tormented words of one of my buddies who’s been on the fence longer than that Humpty Dumpty fella. And you guys know what happened to him. So if you’ve found yourself asking the same question, you’re in luck. Today we’re putting this question to bed!
Why you’re asking the “should I buy a house now” question.
More than likely, you’re tired of your living arrangements, and have your sights set on buying a house. In fact, you’re probably even ready to buy, but the current real estate market conditions have you worried! Housing prices are at an all-time high, and you’re certain they’ll come down any day now.
I mean, there’s nothing worse than splurging on a brand new sound system, only to find out it went on sale the very next day. Except, this is about 1000x more money.
I was plagued with this question too.
When I was first ready to buy, housing prices were at an all time high too! It felt crazy to commit to those mortgage payments when everyone was warning me that we’re in a dangerous bubble about to pop.
Just try making a level-headed decision when everyone around you is screaming CRISIS!
That was 9 years ago, and my home value has doubled in market value.
That’s when I realized that all first time homebuyers will feel this way. That fear of regret that the market conditions will turn around and they’d be out of luck.
Back to my tormented friend.
The friend who keeps asking “should I buy a house now” has been sitting on the fence for at least 5 years.
He’s single, and his one-bedroom apartment suits all his needs. Except…
His next-door neighbors are starting to give him headaches, he doesn’t have his own parking spot and has to park on the street, and his space is becoming a little crowded with all the nerdy man-toys he bought with his disposable income. (That one’s his own fault, though.)
And still, he’s on the fence. The market conditions will turn around any day now, he says, then I’ll be ready to buy! As if!
So what’s your excuse?
Let’s look at a couple of scenarios, and see if you should buy a house or wait.
Moving for work? Don’t wait to buy the house.
Let’s think about it this way. If you’re thinking of moving because you hate your job, or you just hate your commute – buying that house is already worth it.
If your commute is an extra hour a day, you’re wasting 260 hours a year! And if you value your time at say $50/hr, you’re LOSING $13,000 by NOT moving. And that’s not including the actual cost of driving. Add that into your equation.
So maybe waiting for better market conditions would help you save a few grand, but how much are you losing by waiting?
Waiting for prices to come down? Not worth it.
Housing prices are high right now. I know. And it’s true, we might even have a housing market crash, but we really don’t know when it will happen or if waiting for it is justified.
Like I said, I bought my house 9 years ago, when everyone was sure the real estate market was about to pop, and my home’s value has already doubled.
It doesn’t pay to listen to the doomsayers or the market timers. Just go on with your life.
By the way, even when we had the 2009 housing market crash, where I live the home prices only went down by about 20%. But then they’ve climbed 10% every year after that.
So unless you were ready to buy right then and there, timing the market didn’t really gain you anything beyond the growth everyone else experienced.
Buying an Investment Property? Waiting = losing money!
If you’re buying a home as a rental investment property, the market doesn’t even matter.
The only thing that matters is that the house is profitable. Meaning your income in rent is more than your mortgage payments and expenses.
Even if the house’s value goes down, your rent income probably won’t. And buying a house now means that you can build up some gains in the more likely scenario that the house will go up instead of down.
So is the answer always YES?
If you’re already ready to buy a house, but feel paralyzed because of some doomsayers telling you it will be worthless, then ignore them.
If you don’t want or need a house, but feel like buying one just because you should then think twice. Don’t walk into buying more than you need to make someone else happy.
Should I buy a house now?
If you know you’re ready to buy a home, then stop asking should I buy a house now? You’re really only procrastinating. Remember that housing prices have been going up, and when they drop it’s not by much. You really gain nothing by waiting.
Is buying a home a good investment now?
If you’re buying a rental investment property, the earlier you act the better. As long as it starts off as profitable, its rental income likely won’t go down even if house prices drop. Plus, you can start capitalizing on the home’s appreciation earlier.
Is it good to buy a house now or wait?
If you’re ready to buy a home now, then don’t bother waiting. Historically, housing prices have only been going up, and when they do drop, they only go down slightly and bounce back quickly.
Should I buy a house now?