Now’s the time to buy, prices are high, interest rates are low, it’s a hot market, costs are rising. You’ve heard it all before, right?
So, how do you really know when it’s time? The truth is that, based on your current needs and individual inclinations, there are only a few possible scenarios when it’s definitely not the right time. It depends on your risk tolerance and your finances, and buying a home is always a personal decision.
What’s right for your best friends is not necessarily right for you.
Today, rental prices are rising, and so are the cost of materials and labor, meaning that new home prices will probably continue to escalate. It’s also true that today’s low interest rates may not last. From all indications, now is a good time to buy a home, in most places, and perhaps for many people.
Whether it’s the right time for you to buy, only you can answer.
To take the decision-making process one step further, you might want to reconsider if your answer to any of the following questions is a “No.”
- I am ready to settle down, and this is where I want to settle.
- I am currently employed with a company I like and I can see my future unfolding right here.
- I have enough money to make a reasonable downpayment. I have the income and job stability that allows me to qualify for a loan, and I believe I can find a home within my budget.
A “Yes” or even a “don’t know” or “maybe” response to the following should prompt some more questions in your mind:
- I want to explore lifestyle options for the next few years, but I know that buying a home and building equity is a smart move.
- I’m comfortable here in (fill in the blank) right now, but I don’t know if I want to remain here forever.
- I like my job, but I don’t see my current company as a lasting final career choice.
- My future is yet to be determined, and I’m looking forward to a pending change in my family situation.
A home involves a long-term responsibility, and not only in terms of ongoing maintenance and upkeep. In addition to the expectation of value appreciation over the long term, there is the reality of insurance, utility bills, repairs, yard work, taxes and other incidentals, furniture and security.
Buying a home is a major decision. Don’t take the decision-making process lightly. It should be part of a well-considered plan that involved not only you but your entire family and perhaps trusted advisers as well.