The timing of buying a property can make a huge difference to your life. Some people manage to strike at just the right time and end up with an amazing house that they have paid a fair price for. Others may regret when they have bought, and finding a time to strike while the iron is hot can lead to getting a much better deal and generally being better off financially.
So what sort of things will come into play? Is now the right time to buy in Texas or should those looking for a new property hold off for now?
Consider the sort of economic questions that will help you to understand the industry. What is deflation? How does this impact the markets? What is the deal with interest rates at the time of buying and how can this affect your buying and selling?
All of this will help you determine whether or not it is the right time to buy your Texas property.
The shift from a seller to buyer market
In many parts of the world, 2022 was a seller’s market, with more people than ever looking to buy something that could suit their needs as a family, but also more confidence in the market after years of uncertainty. People who had held off moving suddenly had the inclination to buy somewhere new.
The last 12 months have seen something of an economic squeeze. In some places this is being referred to as a “cost of living crisis”.
United Way Dallas has explained the problem in North Texas: “Energy prices have jumped 40.2% and food prices have increased 11.6% since summer 2021. Meanwhile, the cost of rent in our region is up 17% year-over-year”
People are having their finances squeezed somewhat, which means that it is really not easy for them to find the finances for a mortgage or other expenses. Some of the people who are able to buy are finding that they don’t have anywhere near as much competition as they may have had a year ago.
Other things that are impacting this include jobs, and though Texas has a solid business scene, some businesses are having to announce lay-offs as they feel the pinch of rising prices.
In the housing market, fewer potential buyers can lead to prices dropping. After a truly dramatic rise in many parts of the state, the second half of 2022 saw a drop, which has continued into 2023. For some people, prices dropped by over 10% in that time.
Is now the time to buy?
As always, the time to buy depends on so many different factors.
A good time for cash buyers seems to lie ahead, especially if you can time your purchase for when the market hits its lowest ebb. If you have a source of funds already then this could be the time to purchase a property, especially if you plan to make improvements and flip the property when the markets have recovered somewhat.
The interest rates have been adjusted in the US, as the Federal Reserve looks to bring inflation under control. This means if you are borrowing money to purchase a property then you might end up spending a lot on interest. This is not ideal for most people who are looking to make money on a property or just ensure they are getting the best possible deal.
That said, if your mortgage rate is not fixed for the entire duration then there is a chance that you can renegotiate in future years. If you can afford the payments for now and get your dream property at the dream price, this could be an option, too.
Finding yourself being squeezed? It might not be the time to purchase if you don’t have the financial ability to do so at the moment. However, if you have some money behind you and are waiting for a drop in prices, that drop could be just around the corner.
The cost of living in Texas is still lower than a lot of other areas of the US, so if you are looking to move from another state, you might be amazed at both the property prices and the options that you have when it comes to housing.
In summary, it’s a good time to buy if you have the money behind you and are looking to save on last year’s prices, but be careful of committing too much when borrowing.
-In collaboration with Admirals