Why Holding Off On Buying a Home is a Bad Idea

The Weekly Recap

Good morning and happy Friday! Interest rates dropped again, Trump took the axe to congestion pricing in NYC but the toll remains for now, Gov Hochul spared Mayor Adams as she will not remove him from office. There is a ‘singles’ tax in the city, we may be seeing a real life Succession in the works at Cantor Fitzgerald, the K in KFC no longer means Kentucky as the company moves to Texas and if you think you had a bad week, at least your plane didn’t land upside down.

If you missed last weeks newsletter Why Millennials Should Not Be So Pessimistic About Homeownership, you can read that through the link.

Why Holding Off On Buying a Home is a Bad Idea

There’s an old adage in real estate that I share with every agent and client I work with: Time kills all deals. This isn’t just true in real estate, it applies to everything in life. Relationships, career opportunities, investment decisions, even something as simple as deciding whether to go out for the night, hesitation often leads to missed chances.

Another principle I emphasize is the Time Value of Money, the idea that money today is worth more than the same amount in the future due to its potential earning power. Yet, when it comes to the housing market, there’s a common misconception that waiting is the best strategy, as if more time will somehow solve all our challenges. But instead of trying to perfectly time the market, the real key is getting into the market. Here are some reasons why holding off on buying a home is a bad idea.

Rising Prices- Real estate values tend to appreciate over time, meaning that homes are going to be more expensive in the future. As prices rise, so do affordability challenges which could lead to you being priced out of your desired neighborhood. Even small increases in pricing will have a more dramatic impact than fluctuating rates. You are better off buying in high rate environments with lower pricing than lower rate environments with higher pricing.

Paying Rent vs. Building Equity- When paying a mortgage, you are creating an equity (ownership) stake in the property helping to create long term wealth while being able to live in your asset. When paying rent you are doing that for someone else and reaping zero rewards. Renters are also disproportionately impacted by inflation as their leases are renewed every year while homeowners have a rate thats fixed for 30 years with their mortgage.

Inflation Increases the Cost of Living- Speaking of inflation, as things become more expensive such as construction and the cost of living, prices become more expensive. Delaying the purchase of your home now could mean paying more for the exact same property down the road. As more buyers enter the market place with limited inventory, it creates more competition that will drive up prices up and force you to settle for a less desirable home.

Locking in Tax Benefits- Homeownership also affords you the opportunity to enjoy tax advantages such as writing of property taxes and mortgage interest deductions while none of those tax benefits are afforded to renters.

Forced Savings- a mortgage acts as a forced savings plan, helping you accumulate wealth overtime. Real estate is an asset class responsible for 80% of global wealth. It is also the fastest way to creating generational wealth as well as provide financial stability.

While there are some barriers for people who want to buy but cannot (like downpayment) if you can afford to buy but choosing to wait for a better time, it is never a bad time to own. While we may try to time the market as best we can, your ROI in real estate is determined not by TIMING the market, but by time spent IN the market. If you can get in, get in, your future self will thank you.

Market Performance

Here are how some other indexes and asset classes have performed as of this morning’s opening bell.

NYC Market Update

Here is a view of new inventory that has come onto the NYC market over the past WEEK as well as newly signed contracts in Manhattan.

Mortgage Rate Update

Mortgage rates went down again this week as the 30-year fixed-rate mortgage has stayed just under 7% for the fifth consecutive week. The stability and certainty that has followed the rate market has continued to be a positive sign for potential buyers and sellers as we approach the Spring homebuying season.

News You Can Use

• Higher Rents Are Coming if Interest Rates Don’t Budge Bloomberg

• Trump to Halt NY Congestion Pricing by Terminating Approval Bloomberg

• Fed Governor Bowman Says More Progress on Inflation Is Needed Before Further Rate Cuts CNBC

• US Rate Volatility Craters as Tariff-Wary Bond Traders Pull Back Bloomberg

• Singles in the City Pay the Most to Live Alone CNN

• Hochul Won’t Call on Mayor Adams to Resign… Yet NY Post

• Trumps Social Media Posts Create Fewer Market Moves Than In Previous Term Reuters

• In-Person Work Doubled Over the Past Year Axios

• 18 People Injured After Delta Plane Overturns on Landing in Toronto NBC

• KFC Moves US Headquarters from Kentucky to Texas CNBC

• Is the Upper East Side New York’s Hottest Restaurant Neighborhood? Bloomberg

The Deep Insight

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