buying now or waiting another year?

[Anonymous]

OP, we are in a similar boat. Given how quickly things are turning, we plan to wait a year unless we see something really special. But we are very happy with our current rental.

The only other scenario where I’d be OK with buying something now is if we are also selling at the same time as buying, so that we’d be buying and selling high.

[Anonymous]

OP you sound early 30s. are you really ready? or are you very recently married and do you now feel its the next logical life step and in a hurry to do all the "adult" stuff now? there's absolutely nothing wrong with slowing down and renting for 2-3 more years. lots of ppl your age rush into home buying only to realize they are overextended and don't have money leftover for vacations etc. or to have someone lose a job (or get divorced) or all sorts of other unforeseen circumstances. or you have your first child and realize you went too small only a few years earlier. but, if thats not you, now is maybe as good of a time to buy as any. rates are rising and inflation is likely going to impact rents within the next few years.

[Anonymous]

Anonymous wrote:OP you sound early 30s. are you really ready? or are you very recently married and do you now feel its the next logical life step and in a hurry to do all the "adult" stuff now? there's absolutely nothing wrong with slowing down and renting for 2-3 more years. lots of ppl your age rush into home buying only to realize they are overextended and don't have money leftover for vacations etc. or to have someone lose a job (or get divorced) or all sorts of other unforeseen circumstances. or you have your first child and realize you went too small only a few years earlier. but, if thats not you, now is maybe as good of a time to buy as any. rates are rising and inflation is likely going to impact rents within the next few years.

Rents will go down over the next few years if housing prices go down. They are tied to one another.

[Anonymous]

Anonymous wrote:OP, we are in a similar boat. Given how quickly things are turning, we plan to wait a year unless we see something really special. But we are very happy with our current rental.

The only other scenario where I’d be OK with buying something now is if we are also selling at the same time as buying, so that we’d be buying and selling high.

I'm the Mando poster. Your thought process is totally reasonable as you're happy with your current rental and will only buy if you see something really great. The worst thing you can do is buy when you feel pressured.

Could prices decrease/increase by a few % in the next year? Either area likely.

We did the same and rented for years and don't regret it. Don't buy until you think it's the right time to buy. Nobody knows that future including me, the fed, or anybody else.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP you sound early 30s. are you really ready? or are you very recently married and do you now feel its the next logical life step and in a hurry to do all the "adult" stuff now? there's absolutely nothing wrong with slowing down and renting for 2-3 more years. lots of ppl your age rush into home buying only to realize they are overextended and don't have money leftover for vacations etc. or to have someone lose a job (or get divorced) or all sorts of other unforeseen circumstances. or you have your first child and realize you went too small only a few years earlier. but, if thats not you, now is maybe as good of a time to buy as any. rates are rising and inflation is likely going to impact rents within the next few years.

Rents will go down over the next few years if housing prices go down. They are tied to one another.

Demand is still higher than the supply. That is the fatal flaw in your logic.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP you sound early 30s. are you really ready? or are you very recently married and do you now feel its the next logical life step and in a hurry to do all the "adult" stuff now? there's absolutely nothing wrong with slowing down and renting for 2-3 more years. lots of ppl your age rush into home buying only to realize they are overextended and don't have money leftover for vacations etc. or to have someone lose a job (or get divorced) or all sorts of other unforeseen circumstances. or you have your first child and realize you went too small only a few years earlier. but, if thats not you, now is maybe as good of a time to buy as any. rates are rising and inflation is likely going to impact rents within the next few years.

Rents will go down over the next few years if housing prices go down. They are tied to one another.

Demand is still higher than the supply. That is the fatal flaw in your logic.

That’s true today. I’m obviously talking about if the market starts to shift in the way basically every single expert is saying that it soon will.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP, we are in a similar boat. Given how quickly things are turning, we plan to wait a year unless we see something really special. But we are very happy with our current rental.

The only other scenario where I’d be OK with buying something now is if we are also selling at the same time as buying, so that we’d be buying and selling high.

I'm the Mando poster. Your thought process is totally reasonable as you're happy with your current rental and will only buy if you see something really great. The worst thing you can do is buy when you feel pressured.

Could prices decrease/increase by a few % in the next year? Either area likely.

We did the same and rented for years and don't regret it. Don't buy until you think it's the right time to buy. Nobody knows that future including me, the fed, or anybody else.

True story. And love “I’m the Mando poster.”

[Anonymous]

Wait!

[Anonymous]

Anonymous wrote:
Okay, Mandorian, no one has said crash. People, including the Fed, are saying there will be a downturn *beginning* in the next few weeks. Beginning. Not crash. Also, you seem to have conveniently overlooked the data showing that new building starts are at their highest levels since 2006. So new building is surging.

Ughh, people are taking about "worst time to buy since 2007" and "bubble bursting" in the coming weeks. To me it sounds like they're tacitly trying to suggest a crash...or maybe they're just saying it to stoke fears and sound smart--either way it seems a bit deceiving. They could be right, but I think it's very unlikely.

If you state the beginning of a downturn, then sure that's possible. I could certainly see home prices down 1-3% in 2023 compared to now. Or they could be up by that much. Who knows?

Please show me this "data" I'm conveniently overlooking talking about all these new SFHs or even townhomes in areas people always talk about wanting to move to on DCUM-- ie NW DC and the close in parts of Arlington, Alexandria, TP, SS, Chevy Chase, Bethesda? Because there's almost no vacant land in those areas.

And for the record I am not buying or selling right now.

[Anonymous]

Anonymous wrote:

Anonymous wrote:
Okay, Mandorian, no one has said crash. People, including the Fed, are saying there will be a downturn *beginning* in the next few weeks. Beginning. Not crash. Also, you seem to have conveniently overlooked the data showing that new building starts are at their highest levels since 2006. So new building is surging.

Ughh, people are taking about "worst time to buy since 2007" and "bubble bursting" in the coming weeks. To me it sounds like they're tacitly trying to suggest a crash...or maybe they're just saying it to stoke fears and sound smart--either way it seems a bit deceiving. They could be right, but I think it's very unlikely.

If you state the beginning of a downturn, then sure that's possible. I could certainly see home prices down 1-3% in 2023 compared to now. Or they could be up by that much. Who knows?

Please show me this "data" I'm conveniently overlooking talking about all these new SFHs[b] or even townhomes in areas people always talk about wanting to move to on DCUM-- ie NW DC and the close in parts of Arlington, Alexandria, TP, SS, Chevy Chase, Bethesda? Because there's almost no vacant land in those areas.

And for the record I am not buying or selling right now.

Sure. https://tradingeconomics.com/united-states/housing-starts

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If you buy in the next couple of months you will be being buying at the worst possible point since 2007. If you are comfortable with that, that’s up to you, but I would ask what is so urgent that you can’t wait 6 or 12 months? The people who are telling you to buy now, that it will be fine, are realtors who have a personal financial stake in keeping the inflated market going for as long as possible. These are salespeople. Talk to a market forecaster who has nothing to gain from you losing money on a purchase. Read about what’s going on in the larger market, what the rising interest rates will do to prices, what the Fed is doing and predicting. Don’t listen to salespeople.

Incidentally, the people who said don’t buy last year were also right. People who bought in 2021 will take a financial beating too during the downturn. Just not as bad a beating as the people buying now. In a few weeks it’s expected their houses will be worth whatever it’s valuation in 2019 was. They didn’t buy at the absolute peak (which was probably last week) but they still paid a premium they won’t be able to recover anytime soon. Talk to someone in your real life who understands market behavior. Don’t take anonymous advice from a bunch of realtors on the internet.

This PP is trying really hard to sound smart, but here's the hard truth.

1) Housing supply has grown much more slowly since 2007, at the same time millennials have entered their family formation phase and are looking to move to SFHs; they are actually being joined by Generation Z who will likely look to have larger homes sooner because of WFH and the value of outdoor space for this COVID generation (its never going away right).

2) Low rates have definitely made more people capable of paying more for homes, but there are plenty of families being helped by boomer parents, and of course institutions buying more and more SFH. https://www.cnn.com/2021/08/02/business/family-homes-wall-street/index.html Rates have to get really really high to beat out the rental income and with inflation, rents are just going up and up.

3) Rising rates may soften prices of stall them, definitely seems possible, but you as a buyer with a mortage, will likely end up paying MORE over the lifetime of your loan with higher interest payments. MAYBE you can refinance in a decade if we see "historically low" interest rates again. But in the near term, your monthly payment will likely be much higher if you delay further and buy within the next decade.

One caveat, if WFH really really becomes a thing, and you can work from anywhere, that could really hurt major metro markets -- make no mistake, people move to DC for access to Congress and jobs. So if you believe we are in new digital remote only frontier, then you can settle down in Boise and call it a day.

My recommendation, since you have been looking for TWO FING years is temper your expectations, get yourself into some kind of property that you can comfortably afford even with a downshift in your career, and become somewhat coupled to the housing market rather then buffeted by the waves of rising prices and rents as a renter. Basically, get a house with a mortgage as a good old fashioned inflation hedge you can live in.

This is the way.

Just buy when you a) think there's a good chance you'll be in the area for at least 5 years, b) can put 20% down, c) find a house you like that meets your needs. If that's not you, do not buy now ... or at any time until you hit a/b/c.

The doomsayers who say the housing market will crash in "weeks" are FOS. Could it happen? Sure, if WW3 truly starts. Otherwise, no way an abrupt change happens so fast.

Most likely housing prices will go flat or appreciation will slow or prices will slightly decrease. Why? Because because there is no likely singular event that can make any change "happen fast."

No matter how self-assured somebody sounds on here, and intuitively it would make sense for the market to start to at least see slower rates of appreciation...part of the hurdle for that is that inventory remains low compared to demand and the cost of labor and building materials and land have never been higher. People can have all the theories they want, but until inventory drastically increases or the cost to build goes way down...it's pretty challenging to imagine a scenario that causes a sudden down-turn in prices.

Okay, Mandorian, no one has said crash. People, including the Fed, are saying there will be a downturn *beginning* in the next few weeks. Beginning. Not crash. Also, you seem to have conveniently overlooked the data showing that new building starts are at their highest levels since 2006. So new building is surging.

So in 1 year they have made up for a deficit 14 years in the making? Even with supply chain issues?

https://www.businessinsider.com/us-underbuilding-housing-over-the-past-decade-2020-9

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If you buy in the next couple of months you will be being buying at the worst possible point since 2007. If you are comfortable with that, that’s up to you, but I would ask what is so urgent that you can’t wait 6 or 12 months? The people who are telling you to buy now, that it will be fine, are realtors who have a personal financial stake in keeping the inflated market going for as long as possible. These are salespeople. Talk to a market forecaster who has nothing to gain from you losing money on a purchase. Read about what’s going on in the larger market, what the rising interest rates will do to prices, what the Fed is doing and predicting. Don’t listen to salespeople.

Incidentally, the people who said don’t buy last year were also right. People who bought in 2021 will take a financial beating too during the downturn. Just not as bad a beating as the people buying now. In a few weeks it’s expected their houses will be worth whatever it’s valuation in 2019 was. They didn’t buy at the absolute peak (which was probably last week) but they still paid a premium they won’t be able to recover anytime soon. Talk to someone in your real life who understands market behavior. Don’t take anonymous advice from a bunch of realtors on the internet.

This PP is trying really hard to sound smart, but here's the hard truth.

1) Housing supply has grown much more slowly since 2007, at the same time millennials have entered their family formation phase and are looking to move to SFHs; they are actually being joined by Generation Z who will likely look to have larger homes sooner because of WFH and the value of outdoor space for this COVID generation (its never going away right).

2) Low rates have definitely made more people capable of paying more for homes, but there are plenty of families being helped by boomer parents, and of course institutions buying more and more SFH. https://www.cnn.com/2021/08/02/business/family-homes-wall-street/index.html Rates have to get really really high to beat out the rental income and with inflation, rents are just going up and up.

3) Rising rates may soften prices of stall them, definitely seems possible, but you as a buyer with a mortage, will likely end up paying MORE over the lifetime of your loan with higher interest payments. MAYBE you can refinance in a decade if we see "historically low" interest rates again. But in the near term, your monthly payment will likely be much higher if you delay further and buy within the next decade.

One caveat, if WFH really really becomes a thing, and you can work from anywhere, that could really hurt major metro markets -- make no mistake, people move to DC for access to Congress and jobs. So if you believe we are in new digital remote only frontier, then you can settle down in Boise and call it a day.

My recommendation, since you have been looking for TWO FING years is temper your expectations, get yourself into some kind of property that you can comfortably afford even with a downshift in your career, and become somewhat coupled to the housing market rather then buffeted by the waves of rising prices and rents as a renter. Basically, get a house with a mortgage as a good old fashioned inflation hedge you can live in.

This is the way.

Just buy when you a) think there's a good chance you'll be in the area for at least 5 years, b) can put 20% down, c) find a house you like that meets your needs. If that's not you, do not buy now ... or at any time until you hit a/b/c.

The doomsayers who say the housing market will crash in "weeks" are FOS. Could it happen? Sure, if WW3 truly starts. Otherwise, no way an abrupt change happens so fast.

Most likely housing prices will go flat or appreciation will slow or prices will slightly decrease. Why? Because because there is no likely singular event that can make any change "happen fast."

No matter how self-assured somebody sounds on here, and intuitively it would make sense for the market to start to at least see slower rates of appreciation...part of the hurdle for that is that inventory remains low compared to demand and the cost of labor and building materials and land have never been higher. People can have all the theories they want, but until inventory drastically increases or the cost to build goes way down...it's pretty challenging to imagine a scenario that causes a sudden down-turn in prices.

Okay, Mandorian, no one has said crash. People, including the Fed, are saying there will be a downturn *beginning* in the next few weeks. Beginning. Not crash. Also, you seem to have conveniently overlooked the data showing that new building starts are at their highest levels since 2006. So new building is surging.

So in 1 year they have made up for a deficit 14 years in the making? Even with supply chain issues?

https://www.businessinsider.com/us-underbuilding-housing-over-the-past-decade-2020-9

New starts are at the highest level since 2006, so I guess the industry is finding a way around supply issues? In truth, because existing house prices are so high, new builds can charge a surcharge for supplies and still compete just fine. Supply is responding to demand, as you would expect when people are willing to pay for it. Supply is expected to increases in existing homes as well, as millions of prior posts have described in detail. A market as out of balance as this one has been will find a way to correct.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP you sound early 30s. are you really ready? or are you very recently married and do you now feel its the next logical life step and in a hurry to do all the "adult" stuff now? there's absolutely nothing wrong with slowing down and renting for 2-3 more years. lots of ppl your age rush into home buying only to realize they are overextended and don't have money leftover for vacations etc. or to have someone lose a job (or get divorced) or all sorts of other unforeseen circumstances. or you have your first child and realize you went too small only a few years earlier. but, if thats not you, now is maybe as good of a time to buy as any. rates are rising and inflation is likely going to impact rents within the next few years.

Rents will go down over the next few years if housing prices go down. They are tied to one another.

Demand is still higher than the supply. That is the fatal flaw in your logic.

That’s true today. I’m obviously talking about if the market starts to shift in the way basically every single expert is saying that it soon will.

Every expert?

[Anonymous]

A lot of the people saying don’t buy are just trying to cut down on the competition.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If you buy in the next couple of months you will be being buying at the worst possible point since 2007. If you are comfortable with that, that’s up to you, but I would ask what is so urgent that you can’t wait 6 or 12 months? The people who are telling you to buy now, that it will be fine, are realtors who have a personal financial stake in keeping the inflated market going for as long as possible. These are salespeople. Talk to a market forecaster who has nothing to gain from you losing money on a purchase. Read about what’s going on in the larger market, what the rising interest rates will do to prices, what the Fed is doing and predicting. Don’t listen to salespeople.

Incidentally, the people who said don’t buy last year were also right. People who bought in 2021 will take a financial beating too during the downturn. Just not as bad a beating as the people buying now. In a few weeks it’s expected their houses will be worth whatever it’s valuation in 2019 was. They didn’t buy at the absolute peak (which was probably last week) but they still paid a premium they won’t be able to recover anytime soon. Talk to someone in your real life who understands market behavior. Don’t take anonymous advice from a bunch of realtors on the internet.

This PP is trying really hard to sound smart, but here's the hard truth.

1) Housing supply has grown much more slowly since 2007, at the same time millennials have entered their family formation phase and are looking to move to SFHs; they are actually being joined by Generation Z who will likely look to have larger homes sooner because of WFH and the value of outdoor space for this COVID generation (its never going away right).

2) Low rates have definitely made more people capable of paying more for homes, but there are plenty of families being helped by boomer parents, and of course institutions buying more and more SFH. https://www.cnn.com/2021/08/02/business/family-homes-wall-street/index.html Rates have to get really really high to beat out the rental income and with inflation, rents are just going up and up.

3) Rising rates may soften prices of stall them, definitely seems possible, but you as a buyer with a mortage, will likely end up paying MORE over the lifetime of your loan with higher interest payments. MAYBE you can refinance in a decade if we see "historically low" interest rates again. But in the near term, your monthly payment will likely be much higher if you delay further and buy within the next decade.

One caveat, if WFH really really becomes a thing, and you can work from anywhere, that could really hurt major metro markets -- make no mistake, people move to DC for access to Congress and jobs. So if you believe we are in new digital remote only frontier, then you can settle down in Boise and call it a day.

My recommendation, since you have been looking for TWO FING years is temper your expectations, get yourself into some kind of property that you can comfortably afford even with a downshift in your career, and become somewhat coupled to the housing market rather then buffeted by the waves of rising prices and rents as a renter. Basically, get a house with a mortgage as a good old fashioned inflation hedge you can live in.

This is the way.

Just buy when you a) think there's a good chance you'll be in the area for at least 5 years, b) can put 20% down, c) find a house you like that meets your needs. If that's not you, do not buy now ... or at any time until you hit a/b/c.

The doomsayers who say the housing market will crash in "weeks" are FOS. Could it happen? Sure, if WW3 truly starts. Otherwise, no way an abrupt change happens so fast.

Most likely housing prices will go flat or appreciation will slow or prices will slightly decrease. Why? Because because there is no likely singular event that can make any change "happen fast."

No matter how self-assured somebody sounds on here, and intuitively it would make sense for the market to start to at least see slower rates of appreciation...part of the hurdle for that is that inventory remains low compared to demand and the cost of labor and building materials and land have never been higher. People can have all the theories they want, but until inventory drastically increases or the cost to build goes way down...it's pretty challenging to imagine a scenario that causes a sudden down-turn in prices.

Okay, Mandorian, no one has said crash. People, including the Fed, are saying there will be a downturn *beginning* in the next few weeks. Beginning. Not crash. Also, you seem to have conveniently overlooked the data showing that new building starts are at their highest levels since 2006. So new building is surging.

So in 1 year they have made up for a deficit 14 years in the making? Even with supply chain issues?

https://www.businessinsider.com/us-underbuilding-housing-over-the-past-decade-2020-9

New starts are at the highest level since 2006, so I guess the industry is finding a way around supply issues? In truth, because existing house prices are so high, new builds can charge a surcharge for supplies and still compete just fine. Supply is responding to demand, as you would expect when people are willing to pay for it. Supply is expected to increases in existing homes as well, as millions of prior posts have described in detail. A market as out of balance as this one has been will find a way to correct.

Psst. Look up the meaning of the word “start”.