The Best Time to Buy A House: Striking a Balance in the Market
You ask any wise person and they will tell you that the things that they are most proud of in life usually involved some kind of risk. Successful people are full of stories involving the great risk that panned out. They often have stories of great risks that don’t pan out but teach important lessons about life that make them stronger. In the end, we all must take some risks in life. Some of that will be personal, professional, and financial. Often, they overlap. For most people, buying a home is both a financial and personal commitment that involves risk. So how do you decide when it’s the right time for you?
The Brian Burds Home Selling Team has worked with home buyers and home sellers from all walks of life. Buying a home can happen for people of different ages, for different reasons, with different motivations, goals, etc. Since we’ve seen them all, we thought we’d take a look at some deciding factors that can help you think about where you are and whether it’s the right time for you. The key is striking a balance between personal factors and some very practical economic ones.
Do I Feel Ready To Commit For a Few Years?
Ideally, your home will be your primary residence for a long time. For most people, however, this isn’t plausible, as life has many surprises and changes. People well-versed in real estate may sometimes quote the 5-year rule. This is the rule of thumb that says that when buying a home, you should think about staying in that home for at least five years. Here are a couple of things on that:
- It’s not black and white. It may or may not apply to you depending on your personal goals and circumstances.
- Closing costs can add up quickly. You want to try to avoid doing this too close together as it can really make a dent in the pocketbook.
- Interest is usually higher for the first few years of owning a home and maintenance costs can add up. Sometimes homeowners take a hit if they sell within the first few years.
- One option is to rent the home. It’s important to consider having enough wiggle room to pay another mortgage or rent payment if you choose to rent out your home and move elsewhere.
Of course, it’s not a hard rule—nothing is in real estate. It depends on your financial forecast or other factors. Yet, thinking about your life for the next five years can be helpful in deciding whether it’s time to go for it.
Define Your Personal and Financial Goals
Buying a home should be a decision you make with some consideration. And while the “right time” is different for everybody, you want to maybe take some time to define your personal and financial goals. Set a map of where you want to be and make conscious moves to get there. That way, if buying a home and renting within a few years is in your purview and you’re working towards that, then you might be better prepared for what’s ahead. For example, if you plan on moving within four years but you want to rent your house, consider factors that might be attractive to renters and factor that into your home purchase decision.
How Many Houses Can You Afford?
One practical consideration may simply be to sit down and look at the numbers of your current income or expected income for when you look to move in. Another thing to look at when measuring whether you are ready to buy a house is the current interest rates. Taking this into consideration can help you crunch some numbers to see what the fluctuation is.
What is Happening in the Larger National and Local Economy?
Looking at some of these trends and doing a little research can go a long way. You can look at some economic forecasts or talk to a financial advisor that might have a better grasp of market trends and economic stability. If there seems to be some consumer optimism, then this usually means more investment and more economic growth. This may make it a better time to buy.
You can also do the same for your local economy. Take a look at financial patterns in your area and in your city or town. For example, how much housing inventory is available? This can be a good indicator as to whether your local market is geared towards a buyer or seller market. If there are a lot of houses for sale, this might signal a good buyer’s market. At the same time, you can forecast your local economy by looking at other financial factors. This might be with a new manufacturer coming to town, a university, etc. Taking these factors into consideration can help you see trends that might help.
Dive In With the Brian Burds Trusted Home Selling Team
Don’t let someone else tell you when is the right time for you. Strike a balance between the personal and your financial realities in order to gauge your individual circumstances. If you feel you are ready for the commitment of home, are tired of renting, or looking to make a change in your life, we can help.
We can help advise you as to some of the best choices, the best markets, and the best time to buy. The Brian Burds Home Selling Team is made up of experienced real estate experts looking out for every homeowner. We help El Pasoans sell and buy their homes and our top priority is always to help you find the right choice for you. So is it your time? If you’re reading this, it likely is. Give us a call today!