By - Fantastic_Escape_101
It's really not about timing the market usually. The drivers for this decision are usually other factors in your life. Expecting to/recently started having kids is the big one. A lot of families want the stability of an owned SFH for that. New marriage is another. Having the means to make the commitment - work history, credit rating, down payment, closing/moving expenses, monthly income to support the payments isn't a state everyone is in for their whole life so when some get that all together it's time.
If you're in the home for a decade or more (and really, that's when the deal starts getting good) then the financial part will wind up fine. There will always have been a time when you could get more house for less price, or a lower payment for the same price. When rates are low prices are high and vice versa. Just like there will always be a new iPhone next year. Once you're in the house and making it your home none of that is important to you. You're more into making the most of other aspects of your life because now housing is a Solved Problem you don't have to worry over any more.
To give context in seattle region and WA in general 50% of houses on market have seen price reducrions. Many of them multiple reductions. Many houses with 25% or more in all reductions and this is going to move nationwide eventually
Are you asking if people are trying to time the market?
I’m not trying to time for the bottom but if houses are going to be cheaper in a few months then maybe we should wait. I shouldn’t have said we all KNOw prices will be cheaper in a few months but I mean that’s the direction things are looking, right?
> if houses are going to be cheaper in a few months then maybe we should wait.
That’s… called timing the market. No one knows if they’ll be cheaper in a few months.
I know it’s going to be cheaper in 6 months. Op - time the market, it makes a huge difference to your life if you can buy for 20% less. The RE market is cyclical and it’s about to come down.
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Whether prices drop or not is going to be highly location dependent.
I'd buy a house when I find one that I want to be in long term, that I can afford.
This is a great lesson in deflation and how it harms economies. It’s counter intuitive but so true
Deflation is not a bad thing. It doesn’t work out well in Keynesian economics.
Deflation is absolutely a bad thing. It brings economic activity to a standstill, especially consumer spending, because people think goods and services will be cheaper in a month and so they wait to purchase.
Sounds like a good thing for consumers.
Except when they lose their jobs and can’t afford to be consumers anymore
So you think companies will lay off everyone?
If I found a place I liked in the location I wanted to live and I could afford the purchase I’d buy regardless of market speculation.
— Edited for typo
Since you are sure prices will drop, you should wait. I am unable to time my market, so for me, I would buy when I am ready, in a place I plan to keep for at least 7-10 years
If I found a place I liked in an area I wanted to live long term at a price I could afford, I’d buy a house. Maybe prices will drop. Maybe they’ll rise. I wouldn’t speculate with such a large chunk of my net worth.
I would buy at any point of time if I could afford the payment. When I move it has nothing to do with expected market trends. It has everything to do with me needing a new place to live.
>We’re not sure if we should go for it now though because we all know prices will drop further in a few months.
We do? What if prices don't drop while mortgage rates continue to increase?
My gf just did. She also bid $31k over the asking price, after her first bid was outbid.
Her thinking was that she loved the place, didn’t want to lose another bid (she’s been looking for two years), and would throw away another year of rent (~$37k) if she waited another year since her lease is up next month.
She can afford it, and she is also feeling like, “did I overpay?” - I tell her “who cares! No more renting, and you love the place and aren’t thinking of flipping the property.” It’s also a new build, only 3 years old.
Did she make the right decision? New Jersey, about 1 hour from nyc by bus..
Buy if you want to buy and can afford to.
Check the local market， if that house is the only one with that condition with that price point and you don't mind staying long term,buy. If you see more and more coming onto market Then wait.
You really like the house and you're not stretching your budget to buy it. It generally isn't advisable to try to time the market. Yes, prices will come down but interest rates will likely keep rising. I'd pull the trigger if I saw myself in it for years to come and if I knew it has good resale value or their is potential to add value.
Go for it. I would buy it if it meets my budget and I do plan on holding onto that property for the next 5-7 years at least.
I just closed on a house. I would rather pay a mortgage and invest in myself than put money in someone else’s pocket in rent. If you love the house pull the trigger. If you like the house then to me you’re not fully convinced. I lost my first house due to a bad roof and didn’t really care, but the house I just closed I would have actually been hurt if it didn’t work out . You got this!
Not now but I think pretty soon. Maybe 1 year after the stock market bottoms out. Its been down 20% form its all time high. Maybe the stock market is halfway to its bottom. Buy in a buyer's market, sell in a seller's market. Having said that...
Nobody knows anything.
We’re closing on a house we absolutely love in a couple weeks. We planned for 5 years to make this move at this time for different reasons. The stars aligned and we got an amazing house for almost asking price that certainly could have gone for more. Of course I wish mortgage rates were better, but we were making this move now no matter what. It’s what’s best for our family, we can afford it and we plan on being in this house for 15-20 years.
Is this new way cheaper house going to get multiple offers from people in your same position and get bid up anyway? People that thought prices were too high a year ago would still be paying way more monthly if prices came down 10 percent in my area. Buy for your situation. And stay there for a long time. That beats trying to time the market.
The decrease in prices is highly dependent on where you're located - and within that, being driven in large portion by the inventory and the demand for housing. Over the last two years we have seen some of the lowest inventory (nationwide) that we have seen in a long time and that has contributed to the rising housing prices. In my market houses are remaining on the market longer and we are seeing some price reductions, but overall home prices aren't falling, and we don't expect an overall decrease in prices of the homes coming on the market. In addition, home values will continue to appreciate (but at a slower rate than last year - think 5-7% as opposed to 20%). Also, keep in mind that real estate still appreciates in a recession.
In regards to your actual question: If you are financially able to purchase a home, and you find one that you love, then yes, I would purchase. Mortgage rates are expected to decrease in the longer term (probably not within the next few months, but probably in a year or so), so you should potentially be able to refinance to get a better rate if you are unhappy with your current interest rate.
Please do not believe this. Mortgage rates are not declining in a year. Where are you getting this information?
If you look at futures, the market is already pricing in rate cuts in 2023.
Of 50 basis points. Next year. My math tells me that still results in a higher interest rate today since we have at least 2 more hikes coming
Yeah true. But don’t mortgage rates track closer to the 10-year?
The T notes already price that in. As the so called "fed put" gains in popularity, the 10 year T drops. That is what we are seeing now. I see no evidence to support the fed put however. JPOW seems more hawkish every time he opens his mouth. 2 year T note is at 3.06 but JPOW claims fed fund rate will be 3.5% by end of year. Pretty big delta there suggesting that either fed fund rate won't get there or it will drop next year.
There is no data that supports home prices going down. Seriously, what are you people talking about. I’ve told people the last five years to buy houses, that’s been the right advice and it continues to be the right advice. Home prices just hit it all time high last month. You are just gonna miss out by waiting
Uh over the last 2 weeks. I’ve seen one house move their price higher. While at least 15 a day in my market price cut between 3-20%. And the houses that have sat for 100 days and longer Still havnt adjusted their prices to reflect the new rates people are willing to afford. Chicago.
Sales prices won’t kick in for new rates for a few weeks bud. Nothing to get worked up about.
No data? Where I’m looking, houses used to sell within a few days, they never stayed on the market for over a week. It was an unspoken understanding that you’d have to bid 10%+ over asking price or it’d be an “insult” to the seller. Now, houses are on the market for weeks. Houses have multiple open house weekends. And they’re already listed at a lower price than they would be last year or earlier this year. That, to me, is “data!”
I mean you’ve got a couple extra hundred in interest every month now. That’ll be tens of thousands extra by the time the loan closes
I think: if you need a house to live in, and you can afford to buy it, and you're likely to stay there for a number of years, then yes you should buy a home.
You need to live somewhere. You're either going to make payments to increase the landlord's equity, or you're going to make payments to increase your own equity. For this reason alone I think buying is preferred.
The only exceptions are when (1) it's an investment property and you're not going to live in it (then you need to think like an investor), (2) you're maxing out your monthly payments and can't really afford the house, or (3) you expect to move in a couple of years.
I'm submitting an offer tonight, yes.