advice hub

If you’re prepared to take the next step toward buying a home, you’ve probably asked the same question many others are wondering: Is now the right time, or should I wait?

When home prices and mortgage rates are high, it can feel safer to hold off on shopping for a home. But waiting also means potentially missing out on opportunities that are difficult to make up for later, such as building home equity or taking advantage of today’s housing inventory.

Ultimately, deciding when to buy is a personal decision, and one of the biggest financial choices you’ll make. These are the most important factors to consider when timing the housing market.

Home Equity 

Waiting to buy a home doesn’t just delay homeownership, it can also mean missing out on an estimated $10,000 to $90,000 in home equity. Over just a few years, homeowners can build wealth through a combination of rising home values and paying down their mortgage.

According to Federal Housing Finance Agency and Zillow data, home values increased an average of 45% to 55% over five years, which translates to roughly 8% to 9% appreciation per year. In some markets, growth has been even stronger. “Here in Sparks and Reno, Nevada, we’re gaining about 12% a year,” said United Federal Credit Union Mortgage Advisor Beatriz Pico. According to the FHFA, home prices in Reno-Sparks metro area rose sharply over recent years, with strong annual gains contributing to significant equity growth for homeowners.

“People were waiting maybe a year ago, two years ago, because the rates were so high, at almost 8%. But think about all the equity those people lost by not purchasing then. Where you can now refinance into a 5-6%. Your payment is going to be a lot less, and you've gained all this equity.”  

Housing Prices

While some homebuyers wait for mortgage rates to drop, housing prices continue to rise. According to the FHFA, home prices have increased every year since 2012, and data from the Federal Reserve Economic Data by FRED shows the median home price has more than doubled since the early 2000s. If this trend continues, buyers who wait may end up paying more for a home later.

It can be hard to imagine home prices becoming even more expensive than they are today. But once you own a home, rising prices work in your favor by helping you build equity over time. To offset today’s higher prices, many homebuyers are lowering upfront costs by making smaller down payments, using gift funds to help with down payment and closing costs, or taking advantage of down payment assistance programs.

“Right now, the biggest pain points of homebuyers are the price of homes, as well as the rates of homes,” Pico said. “We’re providing options to get people comfortable.” 

Mortgage Rates

Many homebuyers are waiting for mortgage rates to fall before buying a home. Lower interest rates can reduce borrowing costs and monthly payments, and even a small drop can improve affordability, especially for buyers on tight budgets.

However, it’s important to remember that mortgage rate forecasts are not guaranteed. Rates are influenced by a range of factors, including inflation, economic growth, and global events, not just Federal Reserve rate cuts. Even when rate cuts occur, mortgage rates don’t always move lower and can rise again quickly due to market volatility.

Homebuyers who purchase while mortgage rates are higher may have the option to refinance their mortgage loan later if rates come down. By buying sooner, they can begin building home equity right away, while keeping the flexibility to adjust their loan as market conditions change.

Calculate your monthly mortgage payment and adjust the mortgage rate with our free mortgage payment calculator

Housing Inventory

Having more options to choose from can make buying a home more affordable, and housing inventory plays a key role in that. Low housing inventory means the number of available homes on the market has dropped below average, which can limit choices and increase competition for buyers.

Inventory levels can change for several reasons. Higher mortgage rates may encourage current homeowners to hang onto their homes longer, especially if they locked -in a lower rate in the past and want to avoid purchasing at today’s rates.

Inventory can also shrink when housing development slows and fewer new homes are built due to rising construction costs, including labor, materials, and land. If you’re watching a specific neighborhood or region, it’s worth considering how many homes are available now and how that number could change if current trends continue.

World Events 

World events can make the housing market harder to predict, and they do have an impact. Wars, trade disruptions, and global economic instability can ripple through financial markets, influencing mortgage rates and overall home affordability.

Because housing inventory and global events are difficult to predict, many homebuyers focus less on timing the market perfectly, and more on making a move when they’re financially prepared.

What U Need to Know

Trying to perfectly time the housing market can feel overwhelming, especially when rates, prices, inventory, and global events are constantly changing. While these factors all play a role, the most important consideration is often personal readiness: your financial stability, long-‑term goals, and comfort with the monthly payment. For many buyers, waiting for the “perfect” market can be more costly than expected.

If you’re thinking about buying a home, a conversation with a mortgage advisor can help you understand your options, plan for different scenarios, and determine what timing makes the most sense for you. United Federal Credit Union’s mortgage advisors are here to answer questions, explain the process, and help you make a confident, informed decision, whether you’re ready to buy now or just starting to plan.

Have questions? Connect with your local mortgage advisor