Home Price Increase Expected to Continue

Should you buy a home now or should you wait? That’s a big question I hear all the time.  And while what timing is right for you will depend on a lot of other personal factors, here’s something you may not have considered. If you’re able to buy at today’s rates and prices, it may be better to focus on time in the market, rather than timing the market.

Trying to time the market isn't a strategy I have seen many clients have success with over the years. Here’s an example: for the better part of this year, projections have said mortgage rates will come down. And while experts agree that’s still what’s ahead, shifts in various market and economic factors have pushed back the timing of when that’ll happen.

Delaying your plans means missing out on the equity you’d gain if you went ahead with your purchase today. And the potential equity gains that are at stake may surprise you. Each quarter, Fannie Mae releases the Home Price Expectations Survey. It asks over one hundred economists, real estate experts, and investment and market strategists what they forecast for home prices over the next five years. In the latest release, experts are projecting home prices will continue to rise through at least 2028 (see the graph above).

Right now, you may be focused on what’s happening with mortgage rates and how those impact your monthly payment (this is, of course, an important factor!), but don’t forget to factor in home prices. Prices are expected to continue climbing. And while a moderate rise in prices may not be fun for you now, once you own a home, that growth will be a huge perk. That’s the time in the market piece.

Timing the market is a strategy I hear a lot about, but not one I have seen done successfully. The equity you’ll be missing out on for those who continue to wait on the sidelines as the market grows is something to seriously consider.

The bottom line is whether or not it's the right time is a highly personal decision based on your current goals, financial situation, and plans for the coming years. It's not for everyone, that's for sure. But, for those who are waiting for the market or rates to drop (or have been waiting for this since 2019), it's important to consider the projected market gains when considering what's best for you.

If you, or anyone you know, is considering a move this year, please let me know. I'd be happy to sit down and do a consultation to see if buying, selling, continuing to rent, or your particular circumstance is the best option for you.