There are a lot of philosophies on when the best time to buy real estate is for people. However, the most tried and true way to buy real estate comes down to personal choices. The last couple of years was an anomaly, and as most investors stated at the time, “Money is cheap.” Money was cheap with low-interest rates, which caused a lot of chaos. However, the market has shifted, and now it’s time to take a breath.
When it comes to purchasing real estate for personal use or as an investment, it’s best to know your options and levels of risk. There are many factors that determine the value of homes. Some examples include the current economy, interest rates, location of the property, seasons, age of the home, condition, size of the home and improvements made to the home and property. And according to real estate experts, prices are affected by the needs and goals of an area. Is the area growing or shrinking? What is the growth potential? These questions and considerations are needed to understand when the right time to buy and sell is for any given market.
So, it’s not about “timing the market;” it’s about educating yourself about the market. Those that look to time the market are playing a “fools game” and putting a lot at risk. This goes for real estate, stocks or other investments. No one can or ever has accurately predicted the market. It takes a lot of time and focus to analyze the market and stay on top of the trends. Great Realtors study and know the data for their market, and they make an educated decision to help their clients make a great decision on a property. Individuals know what is best for their family needs and desires as they take into consideration when they would like to buy or sell their homes.
People were buying homes in the ’90s with a 10% interest rate, 10 years later in the 2000s, buyers were ecstatic with a 7.5% interest rate. In 2010, coming out of the housing crash, buyers were even happier with 6.5% interest rates and now, 10+ years later, buyers are holding back because interest rates are touching 7%. Home prices are continuing to climb at an estimated rate of 5%, so those that are holding off on purchasing a home at $400,000, are costing themselves $20,000 due to home price increases.
Markets tend to shift quickly, so in this market, it is best to be patient, study the data, do your research and reach out to local experts for their advice. This is a better strategy than attempting to time the market. Imagine what would happen to the community economy if there were a market crash. Would that be good or bad for the community? So, when you hear people talk about waiting for a “crash,” please make sure to understand what that fully means. One of the best strategies is to be patient while being ready to take action when the right property for you becomes available. By taking the time to educate yourself and talking with experts, you can be confident in your decision when making one of your biggest investments in building wealth.