Biased loan officer here. As I sit in the hosptial with my new born on my chest (it’s #2 so I’m less manic) of course I’m thinking about…mortgages!!! I’m also an active duty black hawk pilot which is way less interesting.
I like to frame it this way: when you purchase your first property, you’re essentially contributing to your own lifelong housing fund. Every monthly payment builds equity that stays with you, whereas renting directs 100% of that money to someone else.
As for timing, now is not a bad time to buy. Everything is relative. If interest rates decline, home prices are likely to rise quickly, and many who chose to wait will regret missing the opportunity to purchase earlier. Buyers today can always refinance later if rates improve, but they’ll already have secured their home.
Thanks for coming to my Greg talk.
My biased opinion of why buy now
byu/Certain_Dare_7396 inrealestateinvesting
Posted by Certain_Dare_7396
12 Comments
The black hawk pilot part sounds incredibly boring.
You are biased. Its a terrible time to buy, lmaooo
Agreed. Now is the best time in the last 5 years to buy
I think it’ll get a little better in commercial space, but not worth trying to get things perfect
I just bought my first SFR after a long hiatus
People saying now is a bad time to buy are the same ones who told me it was also a bad time to buy in 2014
As long as it’s the right place, otherwise prices continue to drop.
Rates aren’t great but we also got spoiled for a few years which was a historical anomaly. When rates drop (to like 6 even maybe 5.5) prices will go up. We seem pretty set for another round of inflation.
That said timing the market for a primary residence doesn’t really work. If it’s the right time in your life to buy a reasonable home you can afford then go for it. If rates drop you can refinance.
It’s entirely market specific. In my HCOL market, even though it’s the best buyers market since covid, the interest rates plus appreciation still has me advising potential buyers that buying a home should purely a lifestyle decision. The amount they’re saving by renting is much more than whatever they pay down on their loan balance. Once you factor in maintenance and upkeep, many buyers will be stretched thin.
All this changes when you realize how much it costs for daycare and expenses and what it means to be house poor.
You make too much money to be relatable.
Rate drops are cool. The real problem is the price of the homes in general. Still too high. And yes, if rates drop, the prices will go even higher.
Homes here are 500k for good neighborhoods. You can rent these homes for 2200/mo.
If I were to buy, I would have to put down 3% minimum (15k) and pay 6.5% interest. I lose out on the interest earned on that 15k (50/mo) and pay 2546/mo in interest. Property taxes will add another 400/mo, home insurance 50-100/mo. 3100/mo in expenses.
I have to pay for maintenence/repairs. Yard needs to be maintained monthly (120/mo). A/C is 10k and needs replacement every 25 years (30/mo). Roofs are 15k and need replacement every 25 years (50/mo). Home needs to be painted. Appliances fail. At least 200/mo in maintenance/repairs.
If you sell you are paying 20k in fees to realtors, title companies, transfer tax.
It made sense when homes were appreciating. They are not anymore. There are more sellers than buyers.
It made sense when the standard deduction was lower because you were gaining additional tax benefits. Now the standard deduction for married couples is 30k.
Where I live in Florida, home prices are down 5% yoy and inventory is above pre-pandemic levels.
As long as values are falling in your market, it’s never a good time to buy.
I can’t be alone in thinking dropping interest rates will lead to a massive influx of inventory and a lowering of prices.