Amidst the doom and gloom housing bubble and mortgage escalation news are vital facts that will make the end of 2023 the right time to buy a house for the man who plans in advance.

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How and When to Buy a House

My sister made a mistake: she and her husband tried to buy too much house with a minimum down payment. They kept getting rejected by sellers because they wondered if the mortgage underwriters would value the house the same as the prevailing market. This could lead to a lower mortgage offered to the buyers (my sister and her husband). Then the sellers would either have to accept the lower valuation or discard 30-60 days of having their house off the market and start their house selling process over.

Except, sellers don’t have to do any of that in the current housing market. They can choose from cash offers or people who put a lot of money into the deposit. This eliminates the risk of the sale not being completed. Unfortunately for my sister, that leaves her out in the cold.

Lessons Learned:

1. Save your money. You will not get locked out of the housing market if you can afford to pay cash or a large downpayment (minimum of 20%).
2. Smaller house. Pre-COVID, you may have been able to buy a large house with a minimal deposit at a historically low-interest rate. Those days are over. My grandfather’s first house was small, and he crammed his three kids into it during the 1960s. We have much higher expectations today but are they realistic? Buy what you can afford today and trade up later.
3. Ditch Downtown and Expensive Cities. Do you really need to live downtown or in a suburb? Many people used to do this because of their jobs. With the increasing movement of working from home, all you need is a good internet connection, the conversion of bedroom space to workspace, and you’re ready to work. As my grandfather said: Stephen King wrote many of his best novels on a typewriter on top of his laundry machine in a rural area of Maine.
4. Buy a fixer-upper. If you’re good with tools, there’s always a market to purchase a rundown house and fix it up. As long as the foundation and critical utility infrastructure are sound, anything else can be repaired or replaced for a reasonable cost when you do the work yourself.

If you have others, you’re welcome to send them to me, and I’ll post an update.

Buy a House: Evaluate Your Relationship

It’s always exciting to share with the woman in your life that you want to purchase your first house. It’s a step toward a new part of your life together. But if buying a house negatively changes your relationship, she’s probably not the right person for you.

Or, if you’re not in a relationship, your current housing status is a great way to screen out the wrong women. If they expect that you already must have a home, they’re unwilling to do the work and join you on a long-term adventure. Again, she’s not the right person for you.

When you do find the one who is enthusiastic about joining you on your housing adventure: congratulations!