A long-time friend asked me on Facebook if now was the time to buy real estate. Probably not.
Ask yourself some questions. Will I live in the area for the next 5 years? Is my job secure? Is it cheaper to rent? (Be sure to include all owner’s expenses.) Are you sure? There will be a natural tendency to buy a bigger house than you really need. Avoid this at all costs. John and Mark can share a room, although if your children are named John and Martha ...
If I am right about the upcoming crisis, you will thank me for this unsolicited advice. The flexibility of renting is the ability to move quickly and not be tied to a fixed location. But as the great fictional detective Charlie Chan once said, “Advice is like castor oil, easy to give but difficult to take.” I need to take some too.
I have mentioned in the past one idea that some may take advantage of. You can buy up to a 4-unit apartment and live in one and rent the others and still get the ridiculously cheap fixed interest rates. Do not manage the units yourself. Do not tell your neighbors you are the landlord. Form an LLC so the checks will not be made out to you. It is doubtful you have the skills to be a successful landlord.
Rather than try to reinvent the wheel and give you all the reasons why I think the recent housing price increases are temporary, instead click here to see an interview of David Stockman conducted by Lauren Lyster, two of my favorites. I am not quite as pessimistic as Stockman as I am guardedly pessimistic.