March 18, 2022
When Should I Buy a Home?
by: Chris & Margaret Schnitzler
One of the most common questions that we hear regarding real estate is, “When should I buy a home?”
People are naturally concerned that when the market is hot, home prices rise, and that can put a home purchase out of reach. Conversely, people worry that when home prices seem high, there might be a correction to the market, bringing prices down. I would suggest, as self-serving as it may seem, that the best time to buy a home is when you want to buy a home. In general, the value of real property will continue to rise. If a market correction does occur, then it will get back on track over time.
What does this mean for home buyers? It means that, so long as they are purchasing within their means, there is very little risk over the long term, even though short-term home ownership will always carry a higher risk. So, if your intent is to buy a home to use and enjoy, you’re likely better off buying even if the market is high.
The alternative to owning a home is renting. Financially, this rarely makes sense when compared to home ownership. The rent that you pay is a 100% loss to your budget. When you own your home, you pay down the principal balance while the property typically gains value at least at the rate of inflation. This means that the value of your home is likely to grow faster than an interest-bearing account (i.e., a savings account or a CD).
When you own your home, you also get the benefit of choosing what to do with your property; be it renovations, additions, or even something as simple as having pets in your home.
If you’d like to discuss home ownership, of if you’re unsure of the next step, give us a call! We’d love to offer you a no obligation consultation.
Chris & Margaret Schnitzler