Date of Purchase Beats Home Location


Forget “location, location, location” – it’s “timing, timing, timing.” Spring vs. fall 2022 buyers are now facing very different economic realities.

NEW YORK – Recent mortgage rate changes have highlighted the importance of timing in real estate transactions. Rates increased so much and so quickly in 2022 that those who bought homes mere months apart are now on starkly different financial paths.

Some buyers’ good fortune to lock in historically low rates could pay off for decades and impact their other life choices.

“The real financial winners were the pandemic homebuyers who locked into mortgage rates around 2 to 3%,” says Odeta Kushi, deputy chief economist at First American Financial Corporation. Kushi adds one caveat to the tale of those successful buyers, however: Many of them faced serious competition and may have waived contingencies or settled for less-than-perfect houses. Still, financially, most did well.

The difference in buying a home now versus a few years ago could impact personal finances for decades to come, economists say.

Unfortunately, it’s hard to time the market. Over the past several decades, “good timing” hasn’t been so much favorable prices and interest rates, than what happens in the housing market after the purchase, says Jeffrey Zabel, an economics professor at Tufts University.

The problem for prospective buyers, Zabel notes, is that timing matters, but it’s very hard to know in the moment is fortuitous when you’re living in that moment.

Still, Americans continue to have more faith in real estate than any other financial investment. About one in three (34%) rated it the best long-term investment in a recent Gallup survey, though that’s down from 41% in 2021 and 45% in 2022.

Source: Wall Street Journal (05/19/23) Pinsker, Joe

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