A common question nowadays is still the ever common is now a good time to buy a house? Typically the asker wants to know what I believe will happen to prices in the next few months to a few years.
However, the answer to this question has always been the same – regardless of the market. It depends.
“Depends on what?”, you may ask. Well. Imagine that you visit a hospital and the doctor gives you the following prognosis.
“It’s looking very bad. Your heart will just not last and we will need to get your in for a heart transplant before your heart fails. Luckily, you have a very common blood type and heart type so it will not be difficult to find you a transplant. Also, we expect that heart transplant prices should fall in the next year.”
Would you wait for another year for lower heart transplant prices? I would certainly hope not!
“Yeah. OK. But what does that have to do with real estate? A heart transplant is obviously more important!”, you might say.
For the vast majority of cases, a heart transplant is certainly more important, but depending on your need for a house buying a house may be extremely important too.
Before we bought a house we lived in an apartment where a number of shady individuals lived. One day while I was making dinner a man was gunned down in our parking lot. That night we resolved to get out of that complex and buy a house. For us, it was extremely important.
Another scenario may be that you drive to work an hour and a half each way and are missing spending time with your spouse and children. Does it really make sense to not see them for another year with the hope that prices will drop?
If you are buying a house with the idea that it will be your primary investment and you want to make sure you purchase that investment at the best price, then it is correct that now may not be the best time to buy. It is entirely possible that prices will fall further.
However, if your reason for buying is that you truly need a house, then now is as good a time as ever. Personally, my feeling is that prices will probably remain roughly stable over the next few years. They may drop slightly, but nothing like we saw over the last several years. I do believe they are unlikely to rise for some time though.
So before you ask this question, think to yourself why you want to buy a house. If your reason results in an improvement in your lifestyle and quality of life, now is as good a time as ever to make a move.
