Concerns about buying at the 'peak' of the market - should we pull out?

[Deleted User]

eidand said:

The market does not have a bottom or a top.

If you can find a property which matches your needs, is in the right area, you can afford it and the cost is close to other houses in the area then go ahead and buy. You can't time the market ...

"You can't time the market" typically refers to stock prices which have high liquidity, can move almost instanteously and are (arguably) efficient markets. Housing markets are anything BUT efficient. Low liquidity, slow transaction speeds and highly lumpy inefficient markets. So timing housing markets is risky, yes, but not as impossible as with stocks and it seems pretty clear that prices will fall (a little or a lot though? Is the real question...)

Having said that, mortgage rates are (obviously) rising too, so affordability may decrease even if prices fall.

For a person deciding whether to buy NOW with a long-term mortgage fixed under the older more generous rates, it's a gamble as no-one knows what the world will be like in 5 years (although I personally incline towards cheaper houses and more expensive mortgages...).

MobileSaver

Deleted_User said:

eidand said:

The market does not have a bottom or a top.

If you can find a property which matches your needs, is in the right area, you can afford it and the cost is close to other houses in the area then go ahead and buy. You can't time the market ...

So timing housing markets is risky, yes,

Timing the market is a mug's game and both in stocks and shares as well as housing it has been proven repeatedly that what counts is "time in the market, not timing the market".

What this means is that you are more likely to do better financially by buying as soon as you can rather than waiting to try and buy on the dip. So purely from a financial viewpoint delaying your purchase is normally the wrong thing to do but add in that for most people we are talking about buying their home and all the benefits in life that that brings and it's obvious that trying to time the market is foolhardy.

JuzaMum

I bought my house in 2004, the previous owner bought two years before and doubled their money but I'm sure their new house cost more too. After that prices stagnated for a long time but it didn't matter. I have a home and a fixed mortgage meant I could afford it. I think it helps to look at houses as homes first not assets. 

Sarah1Mitty2

GAMBITv5 said:

The price of a house is only relevant when your intention is to sell / buy.

if you’re planning on living there for the long term then worry about the price when you are needing to sell. If you think you have offered what it was worth at the time you’ve offered it then go ahead I say

Or re-mortgage. Over-borrowing at the peak of a market when interest rates are going up is a classic property cycle mistake which can have long lasting consequences.

Cheesy77

You have a 5 year fix secured at an incredible rate for today's market. Trying to second guess what the market will do in 5 years time is impossible but that is a really long time of certainty you have secured. I'd go for it personally

Sarah1Mitty2

Better to have less debt at a slightly higher rate IMO. Are banks going to honour low rate deals now anyway?