Property – when is the right time to buy?

Whether you’re a first home buyer, relocating or making an investment, the decision to buy property requires careful research and preparation.

So how do you know if the time is right?

Monitor the market?

In theory it seems obvious – watch the property market and buy when prices are at their lowest, right?

But prices and trends can vary widely between suburbs and even individual streets. Even real estate experts can find it hard to predict when the market is going to turn. There’s no guarantee that prices won’t keep dropping after you buy – or that they will ever return to previous highs.

If property prices are low there’s usually good reason. The area you’re considering may be in decline, which could make it hard to sell your property later, or interest rates may be rising, making it expensive to take out a mortgage.

But if you wait until interest rates are lower you can expect both higher prices and more competition as everyone scrambles to buy while mortgages seem cheap.

The good news is that if you’re planning to own the property for a long time price trends don’t matter as much as you may think. Even property investors usually rely on rental income rather than capital gains, because prices fluctuate so much over the long term.

What’s important is that the property meets your needs and that you can afford the price.

Make it personal

When it comes to property there is no blanket ‘right time to buy’. It all comes down to whether the time is right for YOU.

1. Can you afford this – now and in the future?

Even a small change in interest rates could make a massive difference to your monthly repayments.

  • Would you be able to cover higher payments and still meet your living expenses?
  • Can you afford the maintenance costs?
  • Are you ready to tie up your funds in the long-term?

It’s really important to get professional financial advice before you commit to a mortgage that may stretch your resources or stop you achieving other goals.

2. Do you really know what you’re buying?

There’s nothing riskier than buying blind. As well as full inspections of your chosen property, it’s crucial to find out as much as possible about what’s going on in the area.

  • Are any developments planned? A new highway right past your front door could leave your home unliveable and un-rentable, whereas new shops nearby may send prices rocketing.
  • Other factors, like changes to school zoning or a big local employer closing, could also make your property more or less attractive.

Getting expert advice on the local market and region can help you decide if it’s the right time to buy in that area.

At Loan Market [region] we can give you comprehensive local information and guidance to help you find the right mortgage, at the right time.