4 ms·

Well rates are only going to increase from here it seems, which increases the cost of borrowing. You could be waiting a year or more for rates to come back down

Well rates are only going to increase from here it seems, which increases the cost of borrowing. You could be waiting a year or more for rates to come back down. If you're in a solid financial position and you see something you really want, why not?

doctoboggan 4y ago
I guess it seems like the fed is actively trying to pop the housing bubble and drop prices. If that's the case then buying now seems like a bad idea and we should rent for a year first. But honestly we are moving to a new city and I told myself I was done renting and ready to buy. We are in a solid financial position to put a substantial amount down.
- shakes_mcjunkie 4y ago
  If you just moved to a new city would you benefit from waiting anyways? Do you know the neighborhoods you'd want to live in?
- mywittyname 4y ago
  What if this is not a bubble? You can't really time the market. So buy something you want at a price your comfortable with.
- ianai 4y ago
  You’re a good example of how humans are not simple logical and rational decision makers. And also that houses are more than hedonic compositions of goods to be traded solely for investment.
  - datavirtue 4y ago
    Yeah, I worked with a realtor once that kept referring to houses as "the product" as though it was some profound philosophical insight. I wanted to punch him in the face.
- lukas099 4y ago
  I don't think Powell's words mean he is trying to pop a bubble, just to slow down price increases for a while to bring prices in line with historical norms.
  - datavirtue 4y ago
    "to bring prices in line with historical norms." How can you determine if that is the correct/desired course of action?
    - Rury 4y ago
      They publicly state their desired course of action each year. They've historically held an economic policy of maintaining perpetual ~2% inflation over long periods of time. Inflation is higher than that now, so they're trying to bring it back down. For more details see: https://www.federalreserve.gov/monetarypolicy/monetary-policy-what-are-its-goals-how-does-it-work.htm https://www.federalreserve.gov/monetarypolicy/monetary-polic... https://www.federalreserve.gov/newsevents/pressreleases/monetary20220615a.htm https://www.federalreserve.gov/newsevents/pressreleases/mone...
- throwaway892238 4y ago
  Ask any financial professional and they'll tell you if you're trying to buy a house you really want, they'd say not to wait. It's hard enough to find a home you really want and you can't predict future conditions. You might not "get a good deal" but you'll have your dream home. If you were just flipping houses then waiting is the right move.
- thr0wawayf00 4y ago
  It's very hard to time any market, and particularly with a primary residence, most folks plan to stay in them for at least 3 years. It's entirely possible that you overpay today but if you make a smart purchase that you like, there's a pretty good chance your home value recovers in the long run. I think the bubble talk is slightly overstated due to the increase in remote workers. That demand isn't going anywhere soon, which means prices aren't likely to come down much. The Fed is really trying to price out AirBnb and institutional investors, which only account for a small percentage of the market anyway.

doctoboggan 4y ago

I guess it seems like the fed is actively trying to pop the housing bubble and drop prices. If that's the case then buying now seems like a bad idea and we should rent for a year first. But honestly we are moving to a new city and I told myself I was done renting and ready to buy. We are in a solid financial position to put a substantial amount down.

shakes_mcjunkie 4y ago
If you just moved to a new city would you benefit from waiting anyways? Do you know the neighborhoods you'd want to live in?
mywittyname 4y ago
What if this is not a bubble? You can't really time the market. So buy something you want at a price your comfortable with.
ianai 4y ago
You’re a good example of how humans are not simple logical and rational decision makers. And also that houses are more than hedonic compositions of goods to be traded solely for investment.
- datavirtue 4y ago
  Yeah, I worked with a realtor once that kept referring to houses as "the product" as though it was some profound philosophical insight. I wanted to punch him in the face.
lukas099 4y ago
I don't think Powell's words mean he is trying to pop a bubble, just to slow down price increases for a while to bring prices in line with historical norms.
- datavirtue 4y ago
  "to bring prices in line with historical norms." How can you determine if that is the correct/desired course of action?
  - Rury 4y ago
    They publicly state their desired course of action each year. They've historically held an economic policy of maintaining perpetual ~2% inflation over long periods of time. Inflation is higher than that now, so they're trying to bring it back down. For more details see: https://www.federalreserve.gov/monetarypolicy/monetary-policy-what-are-its-goals-how-does-it-work.htm https://www.federalreserve.gov/monetarypolicy/monetary-polic... https://www.federalreserve.gov/newsevents/pressreleases/monetary20220615a.htm https://www.federalreserve.gov/newsevents/pressreleases/mone...
throwaway892238 4y ago
Ask any financial professional and they'll tell you if you're trying to buy a house you really want, they'd say not to wait. It's hard enough to find a home you really want and you can't predict future conditions. You might not "get a good deal" but you'll have your dream home. If you were just flipping houses then waiting is the right move.
thr0wawayf00 4y ago
It's very hard to time any market, and particularly with a primary residence, most folks plan to stay in them for at least 3 years. It's entirely possible that you overpay today but if you make a smart purchase that you like, there's a pretty good chance your home value recovers in the long run. I think the bubble talk is slightly overstated due to the increase in remote workers. That demand isn't going anywhere soon, which means prices aren't likely to come down much. The Fed is really trying to price out AirBnb and institutional investors, which only account for a small percentage of the market anyway.