Found a nice house, top of our price range, but requires us to move from our low priced starter home. The economy seems like a mess and economics was never my forte. Is it a bad decision to try to move up given current trends?
Depends on how secure your financial future is.
Maybe you’re in a good predictable business, or a nice stable government job, maybe you’re in something that’s making money right now, but could turn out to be a flash in the pan like startups, or AI or crypto or Pokemon cards.
Anything can happen, but if you can pay off the loan on your new house quickly, that reduces risk by a lot.
Your financial situation could vary a lot in ways that may not provide good advice from internet strangers. Suggest talking with a financial advisor, see if you employer has access to one as a benefit.
For buying a house two key factors are: what is your current interest rate and potential new interest rate? Do you have stable income/recession resistant job (even if a recession may be a ways off)?
Timing the economy is challenging and many have lost out on trying. Even if you see bad signs for the economy, it can take years for that to have real world impacts on employment or housing values. The market can stay irrational/in denial for a long time until a crash.
What is your interest rate like? If you have a super low interest rate, no, it wouldn’t make sense.
No one can time the market. The answer depends on your risk tolerance and security buffers. It is schrodinger’s market. It is always the best and worst time to hypothetically jump in or out of markets. It’s only after you do that the probability wave form collapses and becomes one or the other.
Predictions depend on a stable system. No where is stable so don’t bother.
I’k probably overreacting, but I suggest spending your dollars while the dollar still has value.
Instructions
unclear, stopped buying anything.
If top of your price range means you’ve already calculated for what would happen if your income was jeopardized, then go for it. If top is living beyond your means, then probably not a good idea any time.
in usa top of our price range means it’s more than they can afford and they are betting on their income going up in the future
As a rookie, look to mortgage rates. Are long term rates significantly lower than shorter term rates? That indicates the big heads (the people who get paid to do this) are saying the market will soften.
I don’t think anyone here would be qualified to answer that, nor would anyone qualified to answer that be necessarily right.
Ah man, that’s a tough call. Personally we’re only moving if the place we move to has some potential for homesteading and self-sustainability to ride out this storm. These next years are going to be pretty turbulent to say the least. We’re laying low and living below our means.
To me the real question is: is your income recession proof? (eg, medicine or some essential service that even survived covid). Because we’re in a silent recession now, likely headed for a depression or major stagflation.
Depends. First, if you need financing, it’s probably not a great time to buy although if things ever get sane, you can refinance. The interest has been high. If you can buy outright, though, that’s a non-issue.
Second, it depends on where you get your income. Some sectors are shakier than others. Rely on public contacts? Avoid. Healthcare? Probably fine. Tech? No idea, probably a bad idea. If you might get replaced tomorrow, do not finance a home.
Lastly, consider where. You don’t want a place that’s going to be hazard prone with global warning. Places are priced accordingly but if your home ends up flooded, set ablaze, or lifted to another location by a hurricane, probably not a great idea. There won’t be enough public support to make up the loss.
I’m personally holding down my starter home but I had to buy points to pay down interest to meet a debt ratio, and my math suggested 8 years to make that a net gain. But the above reasons have factored into my holding back.
It’s always better to not be in the US
I want to buy a new house but I know AI will put me out of work soon, so holding off. Realistically, I should leave for a much lower cost of living country.
We did it. Its tuff. But the home makes the difference in our lives. Betting on wage increases over the long term is hard to calculate but an important part of taking on more debt financing. Rates for mortgages are still low and can aid that financial decision against increases in future wages.
How are you defining low-rate mortgages right now?
are you changing jobs too? is your job secure? do you have 6months +++ emergency fund? do you have a side hustle? does your partner work? are there jobs in the area you can possible do?
@Eryn6844 @FenrirIII why do you need to run after a job ???
Just a guess, but I’d recommend to wait one or two years. Things will get worse, and thus cheaper to buy. In the meantime save up for a larger down payment, instead of stretching your finances now.
After the next election, people will have more hope and prices will increase in the following years. Expect to hold the property for at least 10 years. Anything shorter could be a loss.
