This article that I found on Flickr is an excellent read, though it does remind me of many I read when the world was credit heavy in the past. People spending more than saving is a result of low intererest rates and continuing inflation. People decide to spend when they believe the item they are buying will cost more in the future, and the return on saving the money instead of spending it, is low.
Everyplace I turn, someone is asking "Should I buy a house now or wait?" If you are asking the question, the likely answer is you should wait. It's like asking if you should get married or if you should have a baby. All of these things are important enough to only do when you feel compelled to do so. If there is a hint of doubt, then no...don't do it. Don't even let someone else convince you, and don't make someone else responsible for your decision in any way, shape or form.
List your pros and cons and convince yourself. On the cons, be sure to include that the value is more likely to go down than up in the next 3-5 years.
If the house you are in is dramatically curtailing your quality of life or that of your family, the answer might be yes IF you can well afford to improve your situation.
If you think you might be relocating to a new job in another area in the next 3 years, the answer might be no...stick it out where you are.
If you're not all that happy with your spouse and think to yourself "if this new house doesn't make us happy, I may just call it quits!" Then NO! Do not expect a house to resolve relationship issues. Needing to sell because of a divorce could make a messy divorce even worse.
If the purchase of a house will stretch you to the limit financially and create other problems outside of the home, then no, don't buy a house.
The key is to expect prices to be down a year from now and then ask yourself "Why NOT wait until next year?" If you have a compelling reason why not to wait until next year, then do it knowing that you are doing it for reasons that are not financially based.
If you keep asking "Should I buy a house?" in the hope of someone talking you into it, then you are"
1) Begging to be lied to
2) Trying to shift responsibility for a bad decision on someone else
I would add that the mantra of "there will never be a better time to buy" doesn't work if your house is just a place to live as opposed to being a home. I suspect that somewhere along the line many have lost sight of the intrinsic value of that place we call home. Unfortunately, my TI-BA III doesn't have a button that calculates that value.
Assuming your guidelines and financial basics prevail then buying a home drills down to the gut feeling formula, or as you more eloquently stated, when you feel compelled to do so.
Like you, I'm asked that question often. Obviously the answer depends on many factors, price is just one to consider.
If you are buying a home with the hopes of slapping up some new paint, refinishing hardwoods and tossing it back out onto the market to sell for a profit, you may have missed your boat.
For first time home buyers, and those that are looking to upgrade to a special home (View Home, Waterfront, Better School District etc..) it's time to strike while the iron is hot.
If a buyer chooses to work with an experienced buyer's agent in this market or any other, they will not overpay for a home unless they choose to. While none of us can predict the future of home prices over the short term, it's historically a slam dunk investment over the long term.
I agree with Larry that many have lost sight of one of home ownership's hidden benefits, intrinsic value.
For instance I just had a herd of elk hanging out on my place today, there isn't a spot on my cma for that, but it's worth a ton of money to me.
Buying a house is a serious decision. It is the largest purchase one has ever made in his life. It is not an easy task to find an ideal place to live. Recently I have come across one interesting service http://climate.fizber.com/ With the help of climate watch homebuyers can check what the climate is like in another town or city before they move there.
Never feel compelled to buy in or invest in anything. You cannot lose what you don't put in. There is nothing wrong with renting an apartment. Some people say you are throwing away your money. However sign a 12 month lease. Remember a home loan is usuall y 30 year. Leasing an apartment gives you a chance to sit on the sidelines and wait.
ARDELL
DellaLoggia
On Seattle Real Estate including Kirkland, Bellevue, Redmond, Green Lake and most areas around Lake Washington North of Downtown Seattle.
Phone: 206-910-1000 - Mailto:Ardell@RainCityGuide.com
You can find many great Seattle real estate agents and loan officers on ActiveRain.com ARDELL DellaLoggia is a proud member of the ActiveRain Real Estate Network, a free online community to help real estate professionals grow their business.
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