Should I buy now or wait?

Question

I live in Medford Oregon where I believe the housing market is at a very high point if not the peak. With this in mind I am somewhat intimidated to buy at such high prices. Is it better to wait a year or two to see if the price of housing here starts to drop? Or is it better to buy now, and hope for more appreciation? I may be overcautious, but I fear making the wrong decision. Please help, I need input!

Thank you!

Tyler Vinsand · Answer

Hey Christian, I had almost an identical post a few days ago that got excellent feedback if you wanted to check that out. Ultimately, it is nearly impossible for anyone to predict when a market downturn is going to happen. If you sit and wait for it to fall, you could find yourself two years later without all of the rental income, loan pay down, tax benefits, etc. that RE investments provide. Additionally, a good deal is a good deal, regardless of what the market is doing. Set your criteria, stick to it, run the numbers, and you should be good. Hope this helps!

Justin B. · Answer

It's never a good or bad time to buy.  If the numbers work, the numbers work (this is for buy and hold).  Flipping can be a slippery slope with the market (although many successful flippers may disagree).  Disclaimer: I have never flipped a house, only buy and hold.

Bob B. · Answer

@Christian Clauson I second what @Tyler Vinsand and @Phillip Huber have stated.

I became really aware that real estate was a good idea to the point that I started to intentionally search for a "good deal" around a year and a half ago. Feb of 2016.

Since then I purchased a 3bd/2ba house in Beaverton OR for only $200k that needed some substantial work. It appraised at $230 at the time and a similar house across the street from mine that does not have the new kitchen, new roof, new plumbing and new paint and floors that mine has is pending right now for $360k.

I live in mine with roommates and I borrowed the rehab money. For $10k out of pocket I essentially now live in over $100k of equity and do not have to pay rent to live elsewhere. House hack FTW to dramatically change your current condition quickly and effectively.

A couple months later I also closed on a duplex in a great neighborhood here locally that will pay for itself handily even if the market softens a bit.

So I've found and closed 2 deals in this environment but it has taken me over a year If looking and analyzing a ton of "potentials" along the way.

Point is, if you're actively looking and you're equipped to move (aka prepared) when you see an opportunity, you can find a large array of great opportunities now. Yes, even in the hottest cities and states.

Just takes work and effort and action!

Phillip Huber · Answer

Hi Christian, if your goal is to purchase a single family home or duplex and use the "House Hacking" method as your bio states, then I think you should be focusing on that. If you can do your own repairs, and can make them while you are living there then look for something under market that has room to appreciate - meaning some place that needs work and people aren't jumping on it for some reason. If its a SFH bring in roommates as soon as you make it livable (rentable). Same with a duplex - if you need the money make the side you rent livable first and get it rented. If not, then fix your side up first. You have choices, especially at 19.

You also mentioned your Dad has rentals - I think that is where you start for advice - he sounds like he is where you want to be someday.

Good luck!

Chris Parrish · Answer

Whats everyone's thought process on why the market will tank again? I have recently been researching a ton on the 2008 crash and it appears that if we have another market failure, it will certainly be because of different reasons. Is the main thought process of a crash simply because the market has appreciated at an exceptional rate and we think it will come back down? I would love to hear some of the legitimate reason why we think there will be a large crash again soon.

Will Barnard · Answer

Unless the market is in a free fall, as a buy and ho,set, it is almost always time to buy assuming you make good purchases in good areas at the right price. Counting on or "hoping for" appreciation can get you into trouble. Force appreciate, buy well under market value, and have a solid plan with back up plans in the event something goes sideways.

Kelsie Plummer · Answer

Hey Christian we have a local REA meetup we started here in Southern Oregon that meets every 3 weeks if youd want to join sometime to meet others to learn from and network with. We will post the next meetup here on BP once we get the speaker and place set up - itll be Fri June 2nd at 6:30 - were just finalizing the topic and venue.  If you got to meetup.com or Facebook and look up - Rogue Valley Real Estate Investors Network youll find us!  Hope to see you at one of the future meetups!. Good luck and good for you for starting early!

G. Brian Davis · Answer

Hi @Christian Clauson, and congratulations on even thinking about these issues and investments - it's more than most people ever do.

The best economic experts in the country can't time the market with any certainty, so I would avoid trying to time it yourself. Instead, look for deals where the numbers make sense.

Rents are far less likely to drop than home values are, so if the cash flow numbers make sense now, then they should continue to make sense in the future.

It sounds like you're interested in house hacking - here's an article I often recommend to people thinking about that technique:

https://www.biggerpockets.com/renewsblog/newbie-ho...

Please don't hesitate to reach out by PM at any time,

Christian Clauson · Answer

Thanks guys that was excellent feedback, I appreciate the responses. I will keep searching for good deals! @Phillip Huber @Tyler Vinsand @Bob Bochsler

Should I buy now or wait?

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