When is the Best Time to Buy?

I bought my house in 1995 for a little over $350,000. Being in the business, I thought that I had made a good deal, but within 6 months, I think my house was worth around $25,000 less and I felt pretty sick. Today, 13 years later, my home is worth over $1,100,000, three times what I paid for it and I now I know that I made the right decision. In fact, when looking back, even if I would have paid $400,000 ($50,000 more than what it was worth), it would have been a smart purchase. You see, many of my clients ask me, when is the best time to buy a home considering what the market is like right now.

My answer is, when you find the right home for yourself.

When buying a home you need to look at your long term goals. Are you planning on selling in 2 years, 5 years, 10 years? If you are looking at a short period of time, then maybe this isn’t the right to buy, but if you are looking at 5 years or more, don’t loose a home because of what you read in the newspaper or what you hear on TV. Real estate is local, but most of what you hear about tends to be the worst of it all, because this is what sells newspapers. Just like the weather is different in different areas, so is real estate, especially here in Santa Barbara.

Real estate is also a long term investment and no one knows what is going to happen to prices or to interest rates in the years to come. Especially in our community there are many neighborhoods holding their prices or not changing very much. In the long run, why lose the home of your dreams for 10,000 or 20,000 dollars. You can wait to see if prices come down, but then you may be paying a higher interest rate. Also, look at the past, prices go up and prices go down, but history has show us they that go up faster in the long run. There is no bell that goes off letting everyone know that prices are going up.

So, don’t lose a house if its perfect for you because another one, just like it, may not come on the market again for a long time, or at the same price.