A. The timing of a purchase involves a number of considerations. Everyone is different, and it all depends on what applies to you.
If you are currently living in a rental and considering a purchase, it makes a lot of sense if: 1) You have sufficient funds to complete the purchase with a cushion left over; 2) You have a stable job with good future prospects; and 3) You plan to live in the same place for three to five years or longer.
The reason for this is that, taking into account closing costs and market fluctuations, you want to allow for enough time so that you don’t lose equity. Another benefit is that you may receive a deduction on part of your maintenance cost and mortgage interest.
If you have a family, then you will likely live in your new home for at least several years. The time is right when you have the funds needed to purchase, allowing for a cushion after buying, and sufficient income to carry the new home.
If you are currently renting, then you will enjoy the benefits of tax deductions from your mortgage interest and property taxes.
What about a retiree? It still may be a good idea to purchase depending on a few factors: 1) If you have a good retirement income and are subject to paying income tax so that you will still benefit from the deductions; 2) Continued equity growth - hopefully the purchase you make will continue to build equity which can be passed down to your descendants; and 3) You enjoy home ownership and can deal with the issues that may come up such as repairs and maintenance.
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