Will You Regret the House You Buy Now in Several Years? Here’s What to Consider

Key Takeaways

• The U.S. housing market is full of contrasts right now, with rising house prices despite high interest rates and low inventory levels to contend with
• Those looking to time the market could regret buying now, especially if house prices or mortgage rates come down
• However, those needing to move for personal reasons will be happier with their choice to buy

To buy, or not to buy? That’s the question on every prospective home buyer’s mind right now. With the market more than a little crazy — just how are house prices going up, when interest rates are increasing at the same time? — it can feel impossible to know what to do next. Here’s what to consider before you make a purchase you regret.

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How is the housing market in 2023?

The U.S. housing market hasn’t behaved as expected, as interest rates have increased quickly. The Fed thought house prices might cool off, but instead that’s not materialized: the latest home prices data showed home prices rose by an average of 0.7% in May.

Yet inventory has remained low. Redfin data found that in the four weeks leading up to June 11, US homes for sale saw the biggest decrease in over a year. On top of that, homes just aren’t selling: the National Association of Realtors released data last week that showed existing home sales in June were down 19% from last year.

Even though the battle against inflation looks increasingly optimistic, the Fed is still poised to increase interest rates by another quarter-point this month to take care of sticky core inflation rates. This will likely further increase mortgage interest rates, which are already at a national average of 7.2% according to Bankrate.

Will you regret buying a house now?

Buying a property is always a personal decision. While mortgage rates are higher than they have been in years, big life events like getting a job out of state or having a baby will simply require prospective homeowners to move.

There’s also the possibility that house prices will fall if interest rates continue to climb, meaning some people will buy at the peak and lose money — but it’s impossible to predict how far prices could fall or for how long.

If you’re looking to buy a home in the next few months, you should always look at your financial situation to ensure you’re not overextending yourself. Mortgages are more expensive, so you won’t be able to borrow as much, which could limit your options. But ultimately, you won’t regret buying a house now if it’s the right time for you.

The bottom line

Working out when to buy a home has never been easy — especially when there aren’t enough homes, higher mortgage rates and properties languishing on the market. That being said, those who want to find a new home for personal reasons won’t regret buying now rather than holding out.

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