4 ms·

I’m pretty sure I bought at the worst possible time (March). Every month that goes by, thousands of dollars of my net worth disappear because of circumstances c

I’m pretty sure I bought at the worst possible time (March). Every month that goes by, thousands of dollars of my net worth disappear because of circumstances completely out of my control. It makes me doubt the value of hard work - sure, if you slave away at your desk job you can earn maybe an extra $30k a year, but the guy down the road who just happened to buy a house at the right time earned an extra $300k over the last few years doing nothing.

dividefuel 4y ago
I bought at a similar time, right as rates were starting to really tick up. I got in at 3.75%. That time looks to be the tipping point, but in which direction is still not clear to me. Decreasing home value only matters if you need to sell. If you plan to live in your home for a long time, the changes in the dollar value of the house in the meantime aren't as big of a deal. However, spring was clearly the peak of this market, and it's hard to know how long it will be until a house reaches the same dollar value. It depends a lot on how long interest rates stay high.
- BuckRogers 4y ago
  I've been in the market for a home since summer 2021 and learned a lot. I've gone through multiple agents, realizing how useless most of them are. The one I do find useful said the buyers disappeared around April of this year. Which lines up with your stories. I think buying around April is not the worst possible situation. You at least got the good rates, even if you got peak pricing. I've been grinding on sellers so hard that we either backed out or lost our deals. I'm flush with cash so other than not having a home, happy I'm still in the market as I expect sellers to get the message on the state of the market by January. 2023 is the year for anyone that has cash and has been waiting. My deal won't be perfect either. It may require years of waiting to hit the bottom of the market. I am expecting 2019 pricing soon in my market in 2023, which is all that I'm aiming for.
cameronh90 4y ago
Time in the market beats timing the market. You were always going to need somewhere to live, so whatever net worth you have that's locked inside your house is almost theoretical. Even if house prices crash a huge amount, they'll probably come back at some point, unless we're heading for an era of Japan-style stagnation. It's not ideal, but as someone in a similar boat to you (price agreed mid 2021), I'm probably going to end up technically underwater at some point despite dropping a large deposit. Only thing to do is to bear down and at least be happy that you have a house.
- BuckRogers 4y ago
  That's true but we're talking a very long time when you look at how many decades of gains were priced into these peak prices. Most people that got into an even worse situation (~07) never did get back to purchase price to this day. From what I've seen, these recent peaks didn't match what was going on back then.
supertrope 4y ago
The primary purpose of buying a house is to live in it. Don't look at month to month price fluctuations. The minimum holding period for a house should be 5-7 years due to transactions costs including realtor commission, mortgage origination fees, moving your stuff, and implicit costs like a zillion trips to the hardware store in the beginning.
- nativespecies 4y ago
  Right. Closing costs alone could eat away at 1-2 years of equity. You won't realize gains from a sale until the 5-7 year mark (not withstanding the last few years of fu*kery)
nativespecies 4y ago
Did you buy your house to LIVE in or as a primary investment vehicle? If the latter, I get your frustration (though don't agree with the approach). So many comments here glazing over an obvious factor.

dividefuel 4y ago

I bought at a similar time, right as rates were starting to really tick up. I got in at 3.75%. That time looks to be the tipping point, but in which direction is still not clear to me. Decreasing home value only matters if you need to sell. If you plan to live in your home for a long time, the changes in the dollar value of the house in the meantime aren't as big of a deal. However, spring was clearly the peak of this market, and it's hard to know how long it will be until a house reaches the same dollar value. It depends a lot on how long interest rates stay high.

BuckRogers 4y ago
I've been in the market for a home since summer 2021 and learned a lot. I've gone through multiple agents, realizing how useless most of them are. The one I do find useful said the buyers disappeared around April of this year. Which lines up with your stories. I think buying around April is not the worst possible situation. You at least got the good rates, even if you got peak pricing. I've been grinding on sellers so hard that we either backed out or lost our deals. I'm flush with cash so other than not having a home, happy I'm still in the market as I expect sellers to get the message on the state of the market by January. 2023 is the year for anyone that has cash and has been waiting. My deal won't be perfect either. It may require years of waiting to hit the bottom of the market. I am expecting 2019 pricing soon in my market in 2023, which is all that I'm aiming for.

cameronh90 4y ago

Time in the market beats timing the market. You were always going to need somewhere to live, so whatever net worth you have that's locked inside your house is almost theoretical. Even if house prices crash a huge amount, they'll probably come back at some point, unless we're heading for an era of Japan-style stagnation. It's not ideal, but as someone in a similar boat to you (price agreed mid 2021), I'm probably going to end up technically underwater at some point despite dropping a large deposit. Only thing to do is to bear down and at least be happy that you have a house.

BuckRogers 4y ago
That's true but we're talking a very long time when you look at how many decades of gains were priced into these peak prices. Most people that got into an even worse situation (~07) never did get back to purchase price to this day. From what I've seen, these recent peaks didn't match what was going on back then.

supertrope 4y ago

The primary purpose of buying a house is to live in it. Don't look at month to month price fluctuations. The minimum holding period for a house should be 5-7 years due to transactions costs including realtor commission, mortgage origination fees, moving your stuff, and implicit costs like a zillion trips to the hardware store in the beginning.

nativespecies 4y ago
Right. Closing costs alone could eat away at 1-2 years of equity. You won't realize gains from a sale until the 5-7 year mark (not withstanding the last few years of fu*kery)

nativespecies 4y ago

Did you buy your house to LIVE in or as a primary investment vehicle? If the latter, I get your frustration (though don't agree with the approach). So many comments here glazing over an obvious factor.