Buying our first home, 140k salary, budgeting 300k-350k home. Reading a lot about how real estate market is at an all time high, so truly worried we will buy and in 2 years prices will drop by 20-30%. But we have to live somewhere, and if we are renting, then the same high house prices are reflected in our rent and we are just paying off someone else’s mortgage? Your POVs are much appreciated!

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You have to run the numbers with the projections.
For example calculate the total cost of purchasing home with various fees, maintenance cost, insurance etc then compare to how much rental prices are.

Then do projections if you’ll break even after 1 year, 2 years, 3 years, etc assuming that in n year there is a 0.1 to 30% drop.

This will help you evaluate the risk more appropriately.

We choose to absorb certain risks all the time. A house you buy could disappear in a sink hole or natural disaster. You could find a better job in a few months after selling it which makes you take a huge loss because of the closing fee costs. You never know what will happen.

Make a plan, create a model, make a decision, adjust model and plan after seeing the outcome or learning new information.

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Highly doubt it’ll drop that much

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Even if housing price drops your price is locked in and you shouldn’t buy as rule of thumb if won’t be there for atleast 5 years.

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What market? Until a whole bunch of houses/units get built I personally don’t think prices will drop. Definitely not a sudden 20-30%. If you are somewhere you plan on living another 4+ years may as well.

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Personal suggestion , based on Detroit market - don’t buy anything big that you cannot rent or that you can rent but won’t be fairly compensated . If your end goal is renting when you move out

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I guess no one has a crystal ball, but with such low inventory currently on the market, I struggle to see how these prices will drop..

Low inventory and low interest rates are keeping prices high. The market will bounce down a bit to take the sting out of higher interest rates in a couple years, but I don’t think you will lose anywhere near 20%, especially not in Detroit. Remember the “market is at an all-time high” news is macro economic and doesn’t take into consideration who is buying. It is typically looking at the median home price of recent sales.

Buy what you can afford if you see something you like. Hold onto it for 5-10 years. Even if market drops a bit (which it will, always does) the upward trend will restore your value and continue to appreciate. In the meantime you have 5-10 years of equity to do with what you want.

Keep renting means no equity and MAYBE you find a deal when prices drop but lots of people are thinking that so competition will remain.Buy what you can afford if you see something you like. Hold onto it for 5-10 years. Even if market drops a bit (which it will, always does) the upward trend will restore your value and continue to appreciate. In the meantime you have 5-10 years of equity to do with what you want.

Keep renting means no equity and MAYBE you find a deal when prices drop but lots of people are thinking that so competition will remain.

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