Current Events > What are your thoughts on buying a house right now?

(+) Yeah! (+)

I've heard wait because there is a recession coming and that will result in lower interest rates.

I've also heard a recession is not coming because unemployment is low and as long as people have jobs there won't be a recession.

Alot of balancing points. Supply chain shortage which should get better in the upcoming years. Also supply chain shortage prolonging which could lead to inability to meet demands, companies doing worse, and thus jobs lost and recession. Alternatively theres a big demand for real estate but people are waiting it out. How long will they actually continue to wait.

if you can afford to and are willing to accept the time commitment to maintain then do it otherwise no.

long term it wont get lower priced.. realty has no history of doing that.

Id rather not

I'm actually looking to downsize from my current house that I own. I want to build a tiny home, but its a timely process. My current home is about 700 sq. feet, I'd like to get that down to 500 sq. feet, as its just me and I rarely use my living room.

The downside is that materials are still really expensive.

My parents bought a house in 2014 for $170,000. That house is now worth over hlaf a million. I'm going to wait for a massive housing market crash.

Im glad i dont have to worry about it.

My mortgage comes up for renewal next year though. Interested to see what rates do between now and then.

The stealth thing about buying a house right now is the interest rates. Which were historically raised and unfortunately needed to be. It sucks that it only affects the people that need help the most. The sticker prices are already outrageous but the monthly payments are where things balloon unless your already the perfect home buyer.

New home buyers are getting rare. Its all corporations buying well over asking and then renting out. Its disgusting and will lead to another housing crash.

How bad do you need a house? What kind of financing would you need? How long will you be in it?

I think a correction is coming but it may still be better to buy one instead of rent.

Even with a crash I still couldn't afford what I want here in socal so my hope is to move somewhere cheaper and prices go down between now and the end of next year.

I would say right now is probably the worst time to buy a house since 2007prices are still at an all-time high because the housing bubble hasnt popped yet, but interest rates are jumping right now and are likely to only jump even higher in the immediate future.

So odds are if you try to buy a house right now youre going to get approved for a mortgage with an interest rate thats like, double what you would have gotten this time last year, if not more. Since interest rates are about to skyrocket, the housing market is going to cool, which means the value of your house will drop. Depending on how severe the market cools, the housing bubble might completely pop, and depending on how hard that pop is, you could very well be upside down on your mortgage less than a year into owning your home. Now, if youre in for the long haul, have a stable income, and dont have plans to upgrade or sell your house for a decade or so, then that isnt a huge problem, but its not a situation Id want to be in, and theres still the high interest rate to consider.

Depends, is it in a flood zone?

MrToothHasYou posted...

its not a situation Id want to be in, and theres still the high interest rate to consider.

Should also be noted you cannot refinance if you're underwater on your mortgage so that wouldn't even be an option.

shironinja posted...

if you can afford to and are willing to accept the time commitment to maintain then do it otherwise no.

Not worried about maintanence. Rented a house for 3 years and pretty much took care of most of the maintanence. Plus my father in law lives near by, he's a handyman and retired, he enjoys doing these things.

whitelytning posted...

How bad do you need a house? What kind of financing would you need? How long will you be in it?

I think a correction is coming but it may still be better to buy one instead of rent.

We CAN rent for a bit. I just think that pretty much every rent is overpriced so it feels like wasting money. But if I do the math, its still fine. As long as we keep the rent in the low to mid 2000 range we'd be okay.

At that point we would be constantly looking and basically as soon as we see the real estate market turn around we'd pull the trigger...OR when we see a house that we both love and can afford then we'll pull the trigger. Right now house prices are all going down and interest rates are sky high. We juts figure if we wait a year we would get more value for the same price.

MrToothHasYou posted...

Since interest rates are about to skyrocket, the housing market is going to cool, which means the value of your house will drop

Interest rates are already super high. How high do you think they'll go?

The best case scenario for us home buyers is a recession, job loss, then interest rates go down. Inflation should also improve at that point. And that would be the best time to buy.

Buy a house that you absolutely love or you absolutely love the price. It is rare both will happen.

Entry level homes getting cheap is unlikely short to medium term IMO. The replacement cost is too high. Entry level homes are rarely getting built anymore because there is so little profit on them. You are getting $100-150/square foot construction costs before it makes sense to build anymore. And that's not counting lot improvements.

I think "2nd home" level homes could get a correction. Like a $1M 3000 square foot home dropping to $800k isn't unrealistic to me. But a $400k home dropping to $300k is unrealistic to me.

Rents aren't getting any cheaper and in any decent employment market there are still tons of cash buyers.

For entry level homes to get cheap I think you will need a foreclosure crisis. If you get 1:5 homes purchased between 2020 and 2022 defaulting, THEN stuff will get cheap really quick. But that would require a recession blood bath on par with 08 to happen. A run of the mill 2000-01 recession, I don't think you will notice any appreciably change.

https://www.youtube.com/watch?v=Ea8GyscSFaQ

I think home ownership is a dumb idea tp begin with.

But that's just me.

Will never afford it barring not just market crashes but societal reforms across the board.

Interest rates are rising bro, not lowering.

DanHaren22Champ posted...

Interest rates are already super high. How high do you think they'll go?

No one can say for sure, but there is strong speculation that the Fed is going to raise its target interest rate as much as a full percentage point within the next month (currently its 1.5%1.75%), and if that happens we are all but guaranteed to see another spike in rates across the lending market.

Norman_Smiley posted...

Buy a house that you absolutely love or you absolutely love the price. It is rare both will happen.

Entry level homes getting cheap is unlikely short to medium term IMO. The replacement cost is too high. Entry level homes are rarely getting built anymore because there is so little profit on them. You are getting $100-150/square foot construction costs before it makes sense to build anymore. And that's not counting lot improvements.

I think "2nd home" level homes could get a correction. Like a $1M 3000 square foot home dropping to $800k isn't unrealistic to me. But a $400k home dropping to $300k is unrealistic to me.

Rents aren't getting any cheaper and in any decent employment market there are still tons of cash buyers.

For entry level homes to get cheap I think you will need a foreclosure crisis. If you get 1:5 homes purchased between 2020 and 2022 defaulting, THEN stuff will get cheap really quick. But that would require a recession blood bath on par with 08 to happen. A run of the mill 2000-01 recession, I don't think you will notice any appreciably change.

Hahahahaha! That $400k house is dropping to $100k or less when the "correction" happens.

You seriously underestimate how much cash it out there and how popular REITs are. If homes that would rent for $2000 a month start sniffing $200k all those investors will start buying them up. $100k is fantasy land.