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Originally Posted by kamasutrababe
I'm thinking of buying my first home. Is this bubble going to burst, or should I not bother waiting and buy now since I'm wasting money on rent anyway? I'll be relying on a combination of savings and family loans, so low interest rates aren't really to my advantage anyway. All the agents I've talked to say prices might level off but shouldn't fall. Of course that's what I'd expect an agent to say, so I'm interested in hearing opinions from more objective people.
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I don't know if GFY is the best place for advice for this, while there are some good knowledgable people here on this type of stuff you will also get a bunch of idiots so you have to decided which is which and go from there ;)
First of all you NEED to decide if this purchase is going to be your " dream house" not going to move for like 20 years kinda house. If so buy now, if not I would wait a little longer to see what happens. If you buy now at 700K and the market pops and your house drops to 600K in value next year who cares if you not going to be selling soon, it will go back up in value and in 10 year prolly be worth 1 million or more. If you buy now, and in a couple years it is worth less and you want to move to a bigger or nicer house and you sell you will lose money, not wise.
Also, while prices will likely level off there is no gurantee that they will drop. you could be waiting a long time for them drop if they ever do, and all while you do that you are wasting money on rent. Not sure how much you are paying rent, but if you are dropping 2,000K a month and you wait 2 years you better hope that the market DROPPED 50K in value just for you to even out.
I would suggest getting a loan and financing it. We may never see these intrest rates again in our life time. You should be able to invest your money safely and make more then 6% on it. Not to mention you get tax deductions off of the interest. And for this reason I would buy right now because there is 100% rates are going up and could be as high as 8% in the next year or two.