Once Again Safe as Houses?
A good reason to buy a house: It's affordable, and you want to live in it. A bad reason to buy a house: You're worried about "missing the bottom" in the housing market. (See also: Your Equity Was Always Imaginary)
As soon as housing prices made their initial leg down, I started seeing people thinking that it was time to buy. But very few of those people were saying, "I just saw this perfect house!" Most of them were saying, "Maybe I'd better buy now, before prices go back up."
I saw so many people talking that way, I wrote a post — Don't Worry About Missing the Bottom in Houses. My point was that — unlike the stock market, where prices turn on a dime and zoom back up so fast that it's hazardous to your wealth to try to time the market — the housing market turns very slowly. After the bottom is long past, there will still be houses whose owners didn't sell as prices were falling. Some of them will move to sell at the first sign of rising prices. And, of course, there will always be the occasional motivated seller who simply has to sell.
You never need to rush to buy after a housing crash — house prices will stay down for years. But now, it's been years.
One never knows the future, of course, but sometimes the trends are so strong and so obvious it seems safe to make a prediction. That's how I saw the housing market back in March of 2009, when I wrote that post.
Having done so, I figured I was obliged to mention when it's no longer the case.
I'm certainly not calling a bottom in the housing market. I'm not predicting that prices will go up soon.
All I'm saying is that the abnormal situation where you really can predict a market is coming to an end. Three years ago, I was willing to bet that there was no reason to rush into the housing market. There was no danger of "missing the bottom."
Now things are returning to normal. I don't know that prices will head back up any time soon. But after years in which they really couldn't, I've begun to figure that now they could.
I still think that the only good reason to buy a house is that you've found one you really want to live in, and you're able to get it at a price you can comfortably afford. And when that's the case, you don't really need to worry about whether the market is at the bottom or not.