Up Markets and Down Markets, When to Buy and Sell. (Part 6; The final installment)

This is it. The final one. Not because I can’t find more to say, but because I think I’ve made my point and to continue further would be to labour that point.

This is part 6 of a series where I explore some of the views/assumptions commonly held by people regarding how real estate markets work and what they mean to people who are buying themselves a home. The following is intended to be read in the context of the rest of the series so I recommend reading the other posts to make this one make more sense. The first of the series can be found here.

After this, I’m going to talk less about markets for a little as I would like to prevent this blog from being overly focused on one topic. A topic which, as you can tell by my posts, I feel is already a topic that most people worry too much about as it is. As I said in the very beginning of this series, which is the thesis statement that the reasoning in the series was intended to support, the time to buy yourself real estate (to live in) is when you can afford those payments. Make sure you can make those payments above all, the rest is commentary and methods of maximizing the benefits of making those payments in the long term.

Now, I’ve yet to have anyone challenge me on this topic. Lots and lots of readers though. I would like to hear if anyone feels that I have left anything out or fumbled the reasoning ball. You can always reach me by going here.

Objection #6

“I’ll just rent for now. I’ll wait for the markets to go down.”

Actually this one can work in your favour financially depending on your situation. Particularly if you’re looking at a more expensive property and you don’t mind renting a hovel that is really cheap rent in the meantime. But (yes you were right to expect the “but”) this only going to work if the market is going down quite quickly or if like I say above, you’re looking at something expensive. How expensive? How quickly? Well, it’s case by case so you’ll have to crunch those numbers yourself plus you’ll have to keep right on top of what the real estate market is doing in order to make this work. In the end you have to remember that you have nothing to show for what you pay in rent at the end of the month, but when it’s a mortgage you have something to show for it in terms of equity.

I’ve actually already written this one out in quite a bit of detail in this post:
http://movetonanaimo.com/2008/01/08/when-should-i-buy-my-first-home/

It was one of my very first posts on here because I know that the notion of “I’ll just rent for now…” is common but often held by people who don’t understand how things work.
It’s a long read, but I recommend it. I put a lot of love into it and even though the real estate market was still pretty busy at that point, the same principles still apply.

I’ll wrap up this series of posts by saying again that it’s more important that you’re in a position to buy than what the market is doing. Hopefully, if you’ve read the whole series you now understand why this is my refrain. If you feel I’ve missed something please email me via the contact form on my website and let me know.

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