"So, you're thinking, okay, I'm moving in this direction of buying a house. What else do I need to know? What other things?" Well, we wanted to prepare some questions for you to answer before buying because we think that to be an informed buyer, not just in this market but in any market, you ought to really understand the answer to these questions.
The first one, Brian, that we talked about, and we've said this over and over and over again, is how long is your time horizon when it comes to buying real estate? When it comes to buying a home, it is not a short-term decision because real estate markets don't move in the short term. When you buy a house, we really want you to be in there for five, seven, ten years so that it's not as important what the price you paid was if you give it enough time to cover. Maybe you overpaid a little bit, maybe that's not as big of a deal because you have a long enough timeline.
And by the way, if you're listening to this on the podcast side of things or even watching, you do not have to write down these questions. In a second, we're going to tell you about a free deliverable we've created so you can actually yourself go download from our resource pages, a free deliverable on all the questions you should ask yourself. You can find the free deliverable here
. But I wanted to just free everybody up so you can actually listen to the points, learn, and seep it in so that you understand that Bo is exactly right. Time is one of the biggest factors you've got to consider.
Like I said, I understand if you're moving or relocating to an area, sometimes you have no choice. I bullied Bo into buying his first or second house because they had a growing family, and I was like, "Man, get in there." I feel like I bullied Rebie into her first home to a degree. It is because it lined up with the family need, but others you might need to wait. But overall, still seven to ten years. We always say in our deliverables five to seven years, but I will tell you in this type of a market where there's uncertainty on the pricing, are you getting a good value for the house or is it going to adjust down even further? The longer you can go out on how long you can commit to being in this property and setting routes, the easier it mitigates the variation of the market cycle. So, pay attention. That's the reason it's question number one. How long is your time horizon on this? Frankly, we think that's the most important question when it comes to buying real estate. That's the most important question.
Well, the second question. This is not surprising, and Brian, you talked a lot about this in show prep, and as we've been developing this content, the question you have to answer is, what is the, and I, we used your word. We didn't change it. What's the sizzle of your location? What on earth does that mean, Brian? Why does the sizzle of the location? Well, I think it's so interesting that we just showed at the beginning of the show two very different perspectives. One was saying biggest collapse in real estate of our lifetime, and then we had another commentary who said, hey, best time because we have low supply. You know you're not going to see the drop in the housing prices.
When it comes to real estate, the phrase "location, location, location" is often heard. Certain parts of the country may experience migration patterns and an influx of industry, creating a sizzle that draws people in. It's important to pay attention to these trends because not all locations have the same amount of sizzle. Real estate values can vary significantly depending on the area, and it's crucial to avoid getting caught up in emotion.
For example, after the Great Recession, South Atlanta real estate values got crushed, resulting in a 50-60% reduction in value. On the other hand, the Franklin, Tennessee, Nashville area only experienced a 10-11% loss during the downturn of 2008 through 2010-11. So, when considering a move, you need to do your research and analyze the sizzle in the area before pulling the trigger.
It's also vital to understand that expanding the search may lead to a longer commute, which can negatively impact your happiness. Commuting time is one of the most significant drivers of unhappiness, and you don't want to spend an hour and a half commuting each day. While a shorter commute may seem more attractive, it's important to consider the value of your time and how much of it you are willing to spend sitting in a car.
It's crucial to make a decision based on a full 360 of your life's demands, taking into account population trends, how many people are moving into and out of the area, the number of businesses coming into the area, available job opportunities, and how much time houses spend on the market. Educating yourself about the sizzle in the area can help you make informed decisions.
Sometimes, it makes sense to move further away from a city, such as when you have horses or need a more extensive piece of land. However, it's crucial to measure twice and cut once to ensure you take into account all aspects.
Looking to buy a house soon? Check out our Home Buying Checklist deliverable
. There are many factors you need to consider before buying a home, and this checklist will help you ensure all of your ducks are in a row before making a huge financial decision.