Wednesday, November 17, 2021

Now Isn't The Time To Buy a House


A friend of mine, who's in sales, recently contacted me regarding how "hot" the housing market was and wondered if I was looking to purchase a house. While my friend was well intentioned, I know not to buy when the markets are "hot" as this is when things are more expensive.

What's a hot housing market?

A hot housing market is simply that there's a high demand for houses which as an obvious effect on the price. The reason why it's hot right now is because many people are working from home, due to COVID, and decided to move as they no longer require to live near their workplace.

I live in the countryside and the obvious benefits of living here is the cost of living is a lot less than in big cities. Another friend of mine bought a decent size house, a few years ago, for 70K and could probably get double that today if he wanted to sell it. On my street, 2 houses were sold roughly 2 months after being on sale, which is unusual here, and because they were sold at higher price point than normal it had the adverse effect of raising everyone else's taxes on this block... but that's something for another day.

All this to say that you want to sell when the markets are hot and buy when they're cold. When the markets are hot, more people places bids which increases the prices and when the markets are cold less people place bids and you end up with a better deal. It's a bit like playing a game of hot potatoes ... you don't want to be on the receiving end of the hot potato as you'll get burn.

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