So preferably I would wait another year or two, because I have some late payments on my credit that will be falling off in that time, and I'll have more saved. Im just worried with the economy being so volatile and private companies buying homes that if I dont act soon it'll be too late. Is this totally irrational? I'm probably just being paranoid, but would like some other opinions.
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The best time to buy a house is when you're ready -- financially, emotionally, life-style wise. Your needs and priorities are your own, don't get caught up following someone else timeline just because you feel like you're supposed to be buying now.
The homebuying process is rather stressful and can be exhausting. This is partly because a lot of first-time buyers these days don't have the kind of knowledge or personal experience (from family/friends) that they can draw upon -- so it can really feel like you're in unfamiliar territory.
The best thing you can do is take the time you have now to plan, budget, learn and save. Make sure your making your credit card payments, do what you can to eliminate as much high-interest debt as possible, boost your credit score, improve your career/income if possible, save for your down payment, closing, emergency funds, take a homebuyers' course (can do it for free/online) and really think about what aspects are important to you for you new place.
The market will go up, it will go down -- just keep making smart moves for your own benefit and when the time is right you'll be ready to buy.
Good luck!
^ This right here OP is the best advice! Nobody can predict the market, so you have to go on the facts that you know/are in control of. I,e. Are you ready to buy? Can you afford your mortgage? Do you have comfortable savings on top of closing costs? Can you budget and save wisely for home repairs and maintenance? The best time to buy is when you are ready. And take solace in the fact that refinancing exists if rates do go significantly down!
People told me to wait in 2021 , and then again on 2023 , then they tried to tell me again in 2025 but I said Fuck it Ive been ready on the sidelines it is what it is at this point what goes up comes down and what comes down goes up it’s all the e same
Same I was told to wait for prices to come down. All that happened was prices stayed flat (in my area from 2021 when I was ready to buy until 2025 when I bought) and I blew about $110k on rent in that time.
Versus blowing that amount on interest, prop taxes, insurance, and closing costs? Very little goes to principal until like 15 years into a 30 year.
Yeah let's forget that pretty much anyone that bought a 300-500k house 15 years ago is at least in 150-200k of equity by now.
But sure, instead of paying for your own interest and taxes, you can pay the mortgage for someone else's property (including their interest and taxes) and have nothing to show for it in 15 years.
You’re talking about historic and unusual housing price appreciation for the 15 years following the worst financial and housing crash since the great depression.
Sure, that’s a valid point if you actually stay in your home for that long. Most don’t and you end up losing money. There are other advantages to owning but it isn’t a slam dunk great financial decision like so many make it seem. And this is coming from a home owner.
And guess what, the equity increase in the house from 2021 to 2025 would have made up for that to make buying over renting not even a debate for which was a better financial decision.
Sure that’s correct in select markets and probably just SFH. If you bought in Austin, Florida, or other places in the sun belt you might actually be under water on your mortgage.
My condo that I bought in early 2022 has barely appreciated since then. Banking on housing prices always going up is how the 2008 crash happened and what’s currently happening in China’s housing market.
Well that’s the problem. You bought a condo, not a house. And no, that’s not what caused the ‘08 crash.
It is the least affordable time to buy in history. Renting is much cheaper in pretty much every market in the country and you should use a rent vs buy calculator to understand the numbers. It only makes financial sense to buy if you know for sure you will be staying in that home for 7-10+ years. We are selling our condo and going back to renting until rates drop or prices correct.
Also corporate home buying is completely overblown and a very small portion of the increase in prices. Many are trying to offload the homes they bought in the past five years.
giving your money away to someone else vs in your own investment… how is renting cheaper? its over 2k a month just for a one bedroom near me. a condo thats like less than 200k (depending on HOA fees) would be the same
People forget about the all in cost of owning — mortgage payment (almost all of which is interest at first), property taxes, insurance, HoA fees, and the transaction costs of buying (closing costs) and selling (fees and real estate agent commission. All of those things are the same as lighting money on fire. Financially speaking, owning really only makes sense if you own a home for a long period of time which most people don’t or have a sub 3% mortgage rate.
I am a first time homebuyer and wish I had run the numbers better before buying. It would have been far cheaper for us to keep renting and much easier to move to a bigger place which we now need with a LO. It’s a pain in the ass to sell a home vs just moving somewhere else when a lease is up.
What about building equity? Sure it might be a cheaper monthly payment to rent but you're not building equity.
i can understand the extra hidden fees you dont realize that come with buying like the property tax and repairing things. i’m trying to figure out what type of property to live on right now as a 27 year old single adult… with a dog. renting means you don’t get to make the rules. i prefer to have more privacy and do what i want. also don’t want to give someone else my money instead of it working for me down the road. it really depends on circumstances. it’s nice to be able to pick up and leave whenever you want when renting as well.
You’re still young. I would not want to be tied down by a house keeping me from taking a better job opportunity that might require you to move. You’re at an age where moving for a job can exponentially increase your earnings in a short period of time far more than whatever equity you might be able to build up in the same period of time. You don’t have a wife or kids tying you down yet so mobility is your biggest advantage.
I’ve honestly never had an issue with a landlord not respecting my privacy or making rules (not sure what you even mean by that). It’s not like a landlord can tell you can’t have guests over past 10pm or something.
Buddy, have you ever taken a gander at a rent vs own calculator?
Also, maybe consider not all markets are like yours? In mine, the PITI+M is double the rent for an equivalent home.
How do you measure affordability?
Edit: I mean a measure of the market, not whether a house is affordable for me specifically.
the standard measure for affordability for a market is if the median household income can afford the total monthly cost of the median-priced property sold.
A combination of interest rates and prices both being high at the same time.
When your 16 you should know how to manage money,i started paper routes,lawn service young etc.TODAY kids are lost,MOMMY AND DADDY are not gonna be around forever ?
I asked how to measure affordability, not how to manage money. Specifically I'd like to know if there's a standard economic measure for housing market affordability.
If i am wrong for what i said i made 1 3 year car pymt in 45 years!I DONT FOLLOW anything or anyone,KNOW HOW TO MAKE IT OR BUMMER...
Yeah it’s your monthly all in housing costs. Which is a fsctor of the mortgage interest rate and housing prices.
and property taxes and homeowners insurance, and where applicable HOA fees.
Which it’s my understanding are more tied to general inflation. Interest rates and prices not so much.
your understanding is incorrect.
My property taxes and insurance have increased by more than the inflation rate since 2020.
People buy homes with a FIXED interest rate, at the time they borrow.
The price of the home is FIXED at the time you buy it.
buying right now is significantly more "affordable" statistically than it was in 2022.
How so? Prices haven’t come down except a little in the sun belt markets that went nuts during Covid and rates are still high. Mortgages are tied to the 10 year treasury which last I heard were still high and staying there.
https://www.resiclubanalytics.com/p/the-affordability-strained-housing-market-as-told-by-one-chart
kudos for paying attention to Resiclub - you're on the right track.
But you just linked a 1 year old article, when affordability is a moving figure.
I didn't say "homes are affordable, why are people complaining?"
I did say "Homes are more affordable statistically than they were in 2022."
In November 2022, mortgage rates were ~7%. Today, they are ~6.3%. That means the payment is lower, which means it's more affordable.
Real wages today are 4.7% higher than they were in mid-2022. That means you can afford a higher payment.
Yes buy when youre ready and all that but if i bought last year I would have saved like 50-100k lol
Don’t buy because of FOMO.
Buy when you are ready which includes being able to afford it.
I bought the cheapest place in my Midwestern city, it is still the cheapest 10+ years later, even after adding 100k in equity. Plenty of townhomes and condos around, not everyone has to own a SFH. Just pay attention if HOA is reasonable and if any crazy payments are due to some long overdue roof replacement.
Also keep in mind the prices in many cities actually declined from the peak in 2022
Still, that is often just a start . I think that the prices will have another 10-20 percent to go down and possibly will overcorrect to precovid prices. Especially if there is nothing unique about the area, no coastal line or prestigious college in sight.
Buy a mobile home ?
or manufactured i thought about that. they last like 30-50 years depending on how well you care for it right? but it depreciates in value and weathering could be scary.
I personally feel now is a great time. This is based on nothing though.
Until credit card debt is paid off I wouldn’t think about adding more debt from a house. Markets are unpredictable and a recession could cause housing prices to fall, who knows.
Its not actual debt. Its just late payments from 5 1/2 years ago. So they'll be falling off my report in a year and a half.
All they care about is your credit score for a mortgage. Just check it for free and decide based on that. As far as savings, you want enough to put down so that your monthly payments are reasonable for your income. Also keep some extra for repairs.
But, I wouldn’t buy a house unless you need a house. The market is unpredictable.
The savings for most people in minuscule if any for even a 640 fico FHA loan versus conventional at 800. FHA tacks on a funding fee, but if that means you can buy a year earlier and not rent in the meantime you’re coming out in a similar spot if not ahead.
Yup that’s how they get ya, ask a buyers agent this question I bet they’d love to answer it.
Do you need to buy a home now? If so, I would go the owner financing route.
You should never be in a rush. It should 100% be a decision you make when you’ve had time to feel comfortable with your finances, the responsibility of maintaining a home and understand everything it encompasses. Keep in mind if you do buy now, and prices or rates change in the future, you will probably have an opportunity to refinance OR will have built 1-2 years worth equity in your home to use on whatever you please. Either way, it’s gotta be when you’re ready. Not based on trying to guess what the economy will do.
No rush in my opinion. There's good chance of dropping prices and/or dropping interest rates next year. If I could sell all my properties right now without a big tax bill and put that money in CDs for a year or two, and buy something then I would.
My personal advice, best time is when you’re ready. I wanted to buy one when I was 26 because everyone was in 2020 but I wasn’t actually ready. I would have lived in a not very desirable area and been tied to it forever.
Now I’m 31 and my wife and I bought an area that we absolutely love that’s a brand new build and has warranties on the house for a while. The area is amazing and school district is fantastic. It’s a home we both want to start/grow a family in. Even though interest rates are more we both saved a ton of money renting back than and are starting to scratch our prime earning years so the difference in price doesn’t matter
Forget investment and pricing. If you’re buying to live in it, focus on desire and affordability. Try to picture yourself there in ten years. Focus on you living there, and financially your lifestyle with a mortgage. But when you’re ready.
you definitely need to get your financial house, and your understanding of the economy and housing, in order before you think about buying a home.
Buy when you are in a good financial position to buy. Buy when you have at least a 10% down payment, plan to live in one place for at least 7 years and the monthly mortgage payment is not more than 30% of your monthly salary. Ownership comes with repairs, regular maintenance, property tax, insurance, added utility costs, and any HOA fees on top of mortgage payment.
Best time to buy was yesterday. The second best time is now
This notion that “black rock” and other corporations are buying up houses to stop you from buying them is regarded. Latest census data makes it clear, the vast majority of houses in the U.S. are owner occupied (ie by people). After that the second largest owner of housing inventory are individuals with 2 to 4 rentals (ie small mom and pop landlords).
There is no rush to buy a house, the only people that gain when you FOMO purchase are the banks, realtors, and contractors (when you find all the $hit that needs to be fixed).
But when you can easily afford to put 10%-20%. If you’re afraid that you’re missing out on “building equity”, let me introduce you to this little known secret called the stock market. Stocks—also known as equities—are more capital efficient ways to build wealth and literal equity. Don’t fall for the nonsense that a house is the only way (or even the best way) to build wealth.
A house is a place to live in, nothing else. People love to sell out as some magical dream, it’s nothing special. I have rented and I have owned, the only real difference is who deals with all the maintenance—you or the landlord.
Couldn’t have said it better myself.
Nope. House prices are poised to go down...waiting 1 to 2 years is the right move.
lol they've been saying this for the last 10 years
Yep I remember during Covid it was the “giant bubble waiting to burst” home prices in my area had almost doubled in 3 years. Now they have gone down about 10ish% since Covid. Essentially nothing. Still bubbling
It will continue to decline as long as Trump is in office.
I'm no Trumpster, but this just isn't rooted in data
Of course it is fact based. Job losses monthly are on a down slope trajectory, unstableness in jobs has led to decreased home purchases, more buyers waiting because they are worried about their own job stability.
Told myself that 7 years ago. They're never gonna drop
I bought the same bullshit as well and was waiting for a price correction. Realized after a few years that not only is it not happening, but I’m not going to put my life on pause just to try and time the market.
Timing the market in its best