Time to Buy Now Idea May Be Wrong

Rising home prices are building up the pressure on undecided homebuyers who are considering homeownership before it is too late. But they may be setting themselves up for future regrets, according to Trulia Inc.

Approximately 75% of Americans who participated in the Real Estate Regrets survey conducted by Trulia, an online marketplace for homebuyers, sellers, renters and real estate agents, said it is better to buy a home now than a year from now.

The survey finds that eager buyers matched with patient sellers are bound to fuel today’s competitive housing market.

It means the 2013 housing sales season will be more likely to bring to the marketplace aggressive buyers willing “to scramble in order to try to win tough bidding wars and overcome stiff competition—putting them at risk of making real estate mistakes they will regret,” says Trulia’s chief economist, Jed Kolko.

Only 32% of the 2,130 U.S. adults who participated in the survey between March 22 and 26 agreed it would be better to sell now than a year from now.

These findings reveal the most common housing mistakes today’s homebuyers and renters should avoid during spring house hunting season.

Overly aggressive buyers may be at a disadvantage in a seller’s market.

Faced with limited inventory, “many buyers will feel pressure to act fast,” Kolko said, in times when patient sellers, little new construction, less foreclosures and fewer underwater borrowers “have pushed inventory to a 12-year low.”

The survey is structured to inquire about top real estate related regrets, such as renting compared to home buying, selecting the appropriate living space and budgeting to sustain financial security.

It found that 52% of Americans have regrets about their current home choices—at least one.

Top regrets include not investing enough in their home, choosing a home that is too small, not remodeling more, renters regret they did not purchase, and most regret not being financially secure.

“Although the recession, tight credit and foreclosures have lowered homeownership in America, people would still buy—and buy big—if they could,” said Trulia spokesperson Michael Corbett. “Real estate is back after five to seven years and the way to approach the market has completely changed” due to the tight inventory and fluctuating prices.

New advantages for buyers include the ability to do mobile real estate and mortgage searches that help them make competitive choices.

For-sale homes and rentals listed on Trulia through March 31 also show that more aggressive investors who “bought up cheap houses in hard-hit markets and rented them out to people who lost their homes to foreclosure” have delayed first-time homeownership and the overall residential purchase.