Everyone is worried about what the market is going to do next. Go up. Go down. Stay around where it is. Well, we may need a prophet linked to the divine to determine this one, but there’s good news for you to consider. It doesn’t really matter. Now, I know you’re saying, “OK, he’s lost it.” Nope…I just look at the market in a different way then most people do. Real estate is a long term investment and because it is, it doesn’t matter whether you’re buying or selling in an up or down market. Here’s how I came to this conclusion.

If you’re buying in a down market, you’re probably going to get a better price on the home you purchase. The risk is the market continues to trend down after you buy it. Now, you’re saying, “But, I’m losing money as the market goes down.” No, you only lose money if you sell it. So, don’t sell it.

Real estate over time will flux up and down in a nice wave. In California it tends to move up more than it moves down. For example, if you bought a property 40 years ago, you would have made on average 7% appreciation per year over the 40 year period. This includes all of the down periods. That’s a pretty good run.

So, the short answer is. Don’t let the market cloud the goal. It only confuses things. Think long term and you really can’t lose, no matter what the market is doing. There is only one rule to follow to protect you against the market. Pay at or below what the market is at the time you are buying and not a dollar more. You never want to pay above the market value for your home.

So, how do make sure you’re not paying too much. Ask your agent to give you all of the comparables for homes sold in the neighborhood you’re buying in over the last 6 months. This will give you a good idea of what the value of the home you’re buying should be. Now, the seller may have different ideas about this, but that’s another discussion.