Overview
Buying a home in Q4 of 2022 has proven to be challenging in a variety of ways. Given the recent turbulence in the equity & real estate market, many people find themselves questioning whether now is the appropriate time to buy. The information contained below should provide some insight and hopefully help you answer this question.
What To Consider
Homeownership is considered one of the leading indicators of wealth in the United States. Historical data shows that over a long time period, real estate is one of the best investments that a person can make. Given this information, rather than trying to time the perfect moment to enter the real estate market, an individual should focus on finding a house they love with a payment they can truly afford for years to come.
Pros
Financial
- Historically is an excellent long-term investment vehicle
- Lock in a housing payment for the long haul (no more annual rent increases)
- Protected against future interest rate increases and can take advantage of rate decreases
- Interest rates are near/below the historical average
- Sellers are more willing to negotiate in 2022 compared to the previous few years
Non-Financial
- Provides Stability (No need to worry about lease renewals or finding a new place every year)
- Can provide a sense of pride and accomplishment
- Can lead to a sense of community
- Allows you to customize your living area to fit your personal wants/needs
Cons
- Current Economic Uncertainty
- Home prices are at all-time highs
- Current interest rates are at decades-long highs
- Housing supply has remained limited so far
- Overall monthly payment might be more than rent alone when including taxes, insurance, etc.
- Additional maintenance/expenses can and should be expected
Major Takeaways
Buying a house, like any major life decision, is going to have a laundry list of both pros and cons. There is a strong argument that the right time to buy is when you are ready rather than focusing on general market conditions. With the right team in your corner, you can set yourself up to take advantage of the pros and avoid the headaches of the cons. The biggest advantage is that any borrower purchasing a property now will always have the opportunity to refinance into a better loan later, once the interest rate conditions improve.
If you have any questions about getting pre-approved to purchase a home feel free to call us at (760) 930-0569 and one of our loan officers will assist you.
