Timing the Market is Pointless.

It might seem odd that a blog dedicated to tracking the housing bubble would start by telling you that timing the market is pointless. However; this is not the contradiction it might seem. Instead of timing your purchase based on the perceived strength of the housing market I would argue that you should focus instead on the affordability of the purchase.

In other words, stop falling for those 10 year housing market forecast scam articles. While we might see a correction that adjustment is generally recovered in 5-7 years time. There are variations of purchasing power and supply in the short term that can cause prices to either stagnate or decline temporarily, but as long as you are making long term buying/selling decisions you are going to come out ahead. If, instead, you focus on buying and selling a property every 3 years you are going to barley stay ahead of hte 6-9% in fees you occur with every transaction.

Below is a chart of the Case Shiller index going back to 1987 to illustrate this point. Even if you bought during the peek of ’06 you have recovered everything by ’16. Given this is the most drastic example of a housing correction we have seen I think it is safe to say that buying an affordable home that meets your long-term needs is the way to go.

https://fred.stlouisfed.org/series/CSUSHPINSA