Row of houses with arrow indication price appreciation - What has waiting cost you? Indecision can be expensive If you’ve been on the fence about buying a home, have you considered what has waiting cost you? Indecision can be financially and emotionally crippling. 

Both home buyers and home sellers can experience delays in buying and selling, and also experience losses in what they could accomplish in a real estate transaction because of slowdowns in execution. Since our Silicon Valley real estate market has more periods of home prices rising than prices falling, the majority of damage from delays appear to fall on home buyers.

Sellers may be locked in with low rates and may now be upset that they did make their move up or move down purchase when mortgage rates were better. Buyers may feel like their opportunity window has passed them by.

  • If you’ve been thinking of buying a home for 5 years or more, that wait has cost you lower home prices. There is a chance that you may be priced out of the market.
  • For those who bought a home before rates bottomed out during the worst of the COVID pandemic (rock bottom was January 2021), there was a chance of refinancing and getting a loan at under 3%.  Today rates are closer to 7%. Buyers now are watching rates for a chance to refinance and get a better deal and lower house payment. Rates are hugely important when gauging housing affordability.
  • A fair chunk of buyers are hoping that prices will decline.  Demand far outstrips supply, though, so for now that appears to be wishful thinking.
  • There are some times when home prices go up faster than you can save. Right now appears to be one of those periods. If you decide to “wait and save”, the gap will increase between you and the home you want to buy, sadly.

Home buyers, what has waiting cost you?

Since 2012 our housing market has experienced prolonged periods of rising home prices with only a few corrections here and there. For would be owners, those few corrections were opportunity moments. Our last one was the second half of 2022. When home values are soft, few buyers jump in, though, waiting to get more for their money by holding off.

Trying to time the market seldom works, though. Blink and the market shifts back into the other direction! There’s almost never a perfect time and some objection to buying.

As am example, here are the average and median sale prices for Cambrian Park (MLS area 14), a section of San Jose that is often fairly reflective of the county’s appreciation overall.

The first year is 2013 since from 2006 – 2012 we had a bit of a wild ride with the Great Recession, but by January 2013 we were solidly into an appreciating market.

Cambrian home prices over time - what has waiting cost you?

Obviously there’s more to the story than just home prices, because during this period interest rates fell and then rose again. Most homeowners took great advantage of the below 3% rates and refinanced during the worst of the COVID pandemic to get those rates. Today, buyers who are getting homes with financing are planning to watch for lower rates and refinance when things are more attractive.

Bottom line, look at our sample study in Cambrian of January 2013 and January 2024 and it’s at least 2.5 x in appreciation on the average sale price. This is happening all over, not just in Cambrian, or San Jose, or Santa Clara County, or the San Francisco Bay Area.

Often the hardest thing is getting started, which includes saving and pulling together the down payment, then organizing your priorities (and making them realistically attainable), setting the long term goals (the first home may not be your forever home), and then, when all else is done, being brave enough to execute a plan.

For some, the challenge is waffling about a house they love.  When buyers appear interested, disinterested, interested again, and generally nervous it’s not a good look to present with an offer. The listing agent doesn’t want buyers to get cold feet if their offer is accepted. Give that impression and it may lose the sale for you!

I’ve known people who want to buy and have mulled it over for more than a decade. These are people whose money would have more than doubled had they been able to take action. But fear of commitment (or fear of other things) kind of froze them into inaction. I want to nudge them to buy now, if they can, but feel like it would be cruel to ask them directly “what has waiting cost you?” Indeed, their family’s long term wealth may have been hindered by their ability to move on a home purchase when it was possible.

Buying or selling a home can be stressful and scary. Often, though, inaction leads to disastrous results. There are many work arounds to the fear. Get good support from family or friends. Ideally, get someone you’re close with to see homes with you or encourage you. If you want to buy or sell, you may just need a companion. Don’t be afraid to ask a good friend to walk with you on the journey, to be your sounding board and reality check.

And if you are looking for a Realtor, I get the nerves. When we bought our 2nd home it did depend on my income, too, and I remember waking up with heart palpitations, terrified about the responsibility. That was in 1999 and you can imagine that I’m very glad that I did not let those fears hold me back.  Had I done so, we would have been quite miserable and I’d have been asking myself today’s question: What has waiting cost you? How about 20+ years of being overcrowded and more stressed than necessary?   Yes, I’m glad that we powered through!


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