Oct '23 (edited) • Risks
Is Now a Bad Time to Buy Land?
No one wants to buy land to start planning a build only to have property values continue to drop and realize they could have bought the same piece of land 9 months later for $75,000.00 less.
So is now one of those times where you risk that happening?
The answer really depends on a lot of factors, but tomorrow morning I'll be attending a pretty wicked conference with a bunch of doom and gloom macroeconomic thought leaders speaking about what they see coming down the pipes for Canadian real estate, and currency.
I'll report back to the group with a little summary of what I learn at some point next week.
Generally speaking, right now, land prices are still really high and haven't dropped in kind with resale home values over the past year, making it a tough time to buy land, regardless of whether or not prices are set to drop or not.
Land is a little more inelastic in general compared to land prices in my observations, meaning it doesn't seem to rise as quickly when values rise or drop as quickly when prices drop.
I'm not exactly sure why this is, but I suspect it might have something to do with the fact that most times, land is being purchased in cash, so it is not subject to the same double edge sword amplification effects of the leverage-driven purchasing of resale homes via huge loans, which is very interest rate sensitive.
On that note, if you're not quite sure how financing the purchase of land and or a new home build works, I've been building out the financing modules inside the course preview in the classroom area.
Life's busy right now but I'll be continuing to build these free modules out over the coming months with information that should help move you towards eventually building your own home.
On the topic of the macro economy, when do you think will be the best time to buy land in the next 5 years?
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Is Now a Bad Time to Buy Land?
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