Is this a question that you have in mind? Let’s explore this further.
I recently got asked this question:
As a tenant, I am looking to purchase a house of a similar size. The house prices now are quite high. Should I buy it now or should I wait for the prices to lower?
Concerned first time buyer
It is all relative. There are a lot of factors to take into consideration and, in my opinion, purchasing a home is a very personal experience. My advice always has been that purchasing a property is always relative to your current situation, ability and motivation. Answering a few questions to yourself would make this decision much easier:
- Are you considering to take a mortgage or make a one-time payment?
- Are your finances secured to support monthly mortgage payments and to manage your lifestyle as it is?
- What is the maximum budget you are willing to allocate?
- Compare how much has your rent risen by the percentage of the property prices risen in your neighborhood. If it is property prices are risen higher then it would be worth considering to continue renting or look at a different community or area in the vicinity.
- Does the house match all the requirements that you have in mind that would satisfy your lifestyle for the next 10 years?
- Can I easily rent the house or sell it, in case I am unable to move-in myself?
Once you have answers to the above questions, you will arrive at an answer that would help to figure out if it is good time to buy now or to buy later. After considering internal factors, now you should consider external factors. It should be of note that buying a home is one of the largest purchases most people will make in their lifetime. Hence, the next step is to see if the external circumstances support your internal decision of purchasing a house.
Buy Now or Buy Later?
After considering your internal circumstances, you should consider external circumstances now. These can include:
- Supply and Demand of properties in the community you like
- Off-Plan or Ready (Primary or Secondary purchase)
- Rental contract expiry
- Current position in the real estate cycle
- Economic cycle – inflation, recession, boom etc.
- Real Estate Cycle – position
- Changes in rules or regulations regarding to a property purchase – For example, the new introduction of purchasing an AED 2 Million home in the UAE can help you get a Golden Visa – which can provide you residency for 10 years here in the UAE.
After considering all the factors, the question turns from should I buy now or buy later? -to – Is this the home that fits all my requirements? If that is a yes, then you should buy it. There have been so many times people have regretted not making a purchase when all the factors were aligned and the house met their requirements. We can keep wondering if this is right time and question each decision.
There will always be reasons or people’s opinions that would tell you when is a good time to buy or not. Hear the advice, but make your own decision. If you find the right home for you and you are financially, mentally and physically able to make the purchase then go for it! The real estate cycle will keep going up and down. In my opinion, if all the factors align, that is the right time to buy your home.
We would like to hear what is your opinion on this case is. You can also speak to a real estate advisor or consultant to get a well-informed perspective. So feel free to ask our opinion on the real estate market and we can let you know more details based on which segment you are looking at. Feel free to arrange a call back here or chat with a specialist here.
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