One of the reasons we buy real estate is to realize some kind of home price appreciation. If you purchase here in Orange County, you can pretty much assume your home value will increase year over year. Yearly appreciation varies, and sometimes values go down, but in the long run prices do go UP.
My parents bought their small three bedroom home in Westminster in 1962 for about $19,000. I have a client who purchased their three bedroom home in Irvine for $75,000 in 1972 (he sold it for $816,000 in 2013!). I bought my first three bedroom home in 1983 for $157,000 and sold it in 1989 for $250,000. My current home was purchased in 2002 for $395,000, and one similar to it sold in 2014 for $695,000. Between 2002 and now (2015) we experienced a rising and falling and rising again market. However, my home’s value never fell below the amount I purchased it for (though some homeowners did not have a similar experience). This illustrates the wisdom in purchasing a home and trying to hang on to it for a while rather than trying to time the market.
My father advised me to try and purchase a home at the limit of my budget. He wanted me to buy as much as home as I could afford. The reason being so I could realize the greatest appreciation in value. This advice won’t work for everyone, but it has served me well. My mother showed me the value of holding on to a home and staying put for as long as possible. Again, not practical for everyone, but it worked for her. And it is working for me and plenty of other long-time owners. The longer I stay in a home, making a fixed payment, the more affordable the home becomes, thus increasing my wealth. Thanks for the advice, mom and dad!
In a world of so much change, it is good to know that you can count on the fact that home values will continue to go up in the long term here in Orange County. Demand to own a home here will most likely continue to grow for the foreseeable future and thus be a wonderful place to invest your hard-earned money. Buying a home here is an investment in your future, your security and stability and for some, your family and their future.