Is now a good time to buy a house?

Is now a good time to buy a house? It depends on the housing market and your financial readiness. Mortgage rates, home prices, and inventory affect affordability and negotiating power, but your budget, credit, and how long you plan to stay in a home matter just as much. If you can comfortably afford the monthly payment and plan to stay several years, buying can still be a smart move even if rates remain elevated.

While no one can perfectly time the housing market, understanding both current market conditions and your financial situation can help you decide if now is the right time to buy a house.

Key takeaways:

• Many people are pessimistic about the housing market and their ability to afford a home.
• Mortgage rates, home prices, and inventory can affect affordability and negotiating power.
• The best time to buy a home is typically when your finances, timeline, and local housing market conditions align.

Most Americans say it’s a bad time to buy a house

In a recent survey conducted for Rocket Mortgage, 59% of U.S. adults expressed pessimistic views about the housing market, saying that it’s currently a somewhat or very bad time to buy. By comparison, 33% of respondents say now is a good time to buy. Fifty-three percent say they're very unlikely to buy a home in the next 12 months.

When asked why they were not more likely to buy a home, affordability was often cited as the key reason. Excluding those who already owned homes and weren’t planning on moving, the top three reasons cited were:

• High home prices (19%)
• Insufficient savings for a down payment (18%)
• High mortgage rates (8%)

Respondents were also polled on how the market might change in the future, and there was little optimism that these factors would improve anytime soon. Sixty percent of respondents predicted that home prices will increase over the next year, and about 58% felt that interest rates will rise in the near future.

Respondents whose income is “much higher now” are more than 5 times more likely to say they’re very likely to buy next year and more than 3 times more likely to say it's a very good time. Even so, 31% of this group wants to buy but is held back by a lack of savings.

Millennials ages 25-34 are the most sensitive to borrowing costs and are almost twice as likely to wait for rates to fall.

Current renters are struggling to save up for a down payment and are more likely to say they want to buy but need to save more first.

Methodology

Rocket Mortgage surveyed 1,049 adults in all 50 states and Washington, D.C. The questions were multiple-choice and excluded respondents under age 18 and those who did not have a financial decision-making role in their household.

Why timing your home purchase is important

In addition to financial readiness, timing is key to knowing when to buy a house. While there’s no perfect time to buy a home, it’s wise to be aware of market conditions.

The timing of your home purchase can influence a variety of factors, including:

• The purchase price of the home
• The interest rate on your mortgage
• Mortgage payment affordability
• Negotiating leverage with sellers
• Competition from other buyers

Consider your personal needs

Major life events and lifestyle preferences often influence the decision to buy a home.

Location stability

Buying a home means making a more significant commitment to a location than renting does. One advantage of paying rent vs. buying is you can move on relatively short notice, even if it means paying a fee to break their lease. If a homeowner wants to move, they may have to either sell the home or rent it out. Keep in mind that it typically takes 5 – 7 years to recoup the up-front costs of buying a home such as closing costs.

Major life events

Certain life events can trigger changes in your living situation that affect where you decide to live. As household size, family needs, and careers change, homeowners may decide to upgrade or downsize to a home that better fits their life.

These types of life events can also affect the types of houses you may want to buy. Buyers with kids may choose to buy a home in a specific area known for having a good school district. On the other hand, seniors may prefer to sell their home and rent at that stage of life.

Lifestyle preferences

If you like to travel, prefer not to deal with home maintenance, or tend to move frequently, renting may be a better fit for your lifestyle.

Then again, if you need more space and are ready to plant roots, you might be ready to become a homeowner. One of the biggest perks of buying a home is that it allows you to build equity as you pay back your mortgage. Be sure to consider how the pros and cons of buying a home affect your lifestyle, priorities, and goals.

Assess your financial health

Perhaps the most important consideration when deciding whether you’re ready to purchase a home is making sure you can comfortably afford the costs of buying a house and the ongoing expenses. You'll also need to meet the financial requirements set by your lender.

Monthly budget

To determine how much house you can afford, look at what your monthly budget can accommodate. Remember, buying a home requires up-front costs like the down payment and closing costs, as well as recurring costs such as your mortgage payment, repairs, and maintenance. Homeowners are advised to set aside roughly 1% to 4% of the home’s value for annual maintenance.

It's also important to make sure that your housing costs don’t eat up too much of your budget. When housing costs take up too much of your income, you become "house poor," meaning there’s little room left in your budget for other expenses.

Homeowners are encouraged to follow the 28/36 rule, which states that no more than 28% of your income should go to housing costs, and no more than 36% of your income should go toward all debt.

You can use the home affordability calculator from Rocket Mortgage to get a better idea of how your income, savings, and debts can buy you in different markets.

Income stability

Lenders typically ask to see at least the last 2 years’ worth of W-2 or 1099 forms that prove you have steady work. It’s also important to consider the job market, as changes can result in layoffs, and some types of jobs are more sensitive to economic volatility. If you’re buying a home with a partner, consider the possibility that one of you might experience job loss or a change in pay. If you’re buying a home by yourself, your income stability is that much more important.

Credit score

Your credit score is a figure that lenders use to gauge how well you’ve managed your finances and other debts. This figure not only affects your eligibility but also the interest rate you’re offered. In general, buyers with higher credit scores get offered lower interest rates, which can help you save on interest and reduce your monthly payment.

To get a conventional loan, lenders will look at your overall credit history. Fannie Mae and Freddie Mac no longer require a minimum credit score for conforming loans, but lenders may set their own.

To get an FHA loan with Rocket Mortgage, you’ll need a credit score of at least 580.¹ Some lenders offer FHA loans to borrowers with credit scores as low as 500 with a minimum 10% down payment.

If your credit history isn’t ideal, you can work to repair your credit score by making on-time payments and paying down debts.

Down payment

Another factor that impacts the timing of a home purchase is how long it takes to save up a down payment. Your down payment is reflected as a percentage of the total purchase price. The minimum down payment required will depend on your loan type:

• Conventional loan: 3% – 5%²
• FHA loan: 3.5%
• VA loan: No down payment required³
• USDA loan: No down payment required
• Jumbo loan: Varies, but typically 10% – 30%

Down payment assistance programs are offered by state and local governments as well as nonprofit organizations to help first-time home buyers cover up-front costs.

Beyond the minimum requirement, the size of your down payment will also impact your mortgage payment and the amount of equity you start off with. Larger down payments mean smaller loans and lower monthly payments. If you make a down payment of at least 20% on a conventional loan, you’ll be able to avoid paying for private mortgage insurance (PMI).

The down payment calculator from Rocket Mortgage can help you determine how much down payment you would need, given your home purchase price, income, and credit score.

Debt-to-income ratio

Your debt-to-income ratio (DTI) tells lenders how much of your current income must go toward your other debts. You can calculate your DTI by adding up all your monthly debts and dividing that figure by your gross monthly income. Lenders typically set a limit on how high your DTI can be to qualify for a mortgage. While exact DTI requirements vary depending on the lender, you’ll typically need it to be no more than 43% – 50%.

Understand housing market conditions

Housing market conditions are always changing. Sometimes, the market favors buyers, while other times, conditions can make it more challenging to purchase a home. It's important to understand current market conditions – as well as forecasts of where the market may be headed – to make an informed decision on whether now is the right time for you to buy.

Mortgage rates

Your lender will determine what mortgage rate you’re offered on a mortgage will be based on both your financial information and current market conditions. Just a minor decrease in your interest rate can get you a more affordable monthly payment and help you save thousands on your mortgage overall.

Mortgage rates hit historic lows at the height of the COVID-19 pandemic in 2020 and 2021. In the years that followed, the Federal Reserve introduced a series of federal funds rate hikes to battle inflation. Today's rates hover between 6% and 7%, a trend that has carried into the current housing market. As of May 2026, mortgage rates are sitting at about 6.5%.

Home prices

While home prices can fluctuate in the short term, they have historically risen over time, and prices have risen significantly in recent years. As of May 2026, the median sales price for a new house was $398,771.

Here are the median sales prices for a new home on the market over time:

• May 2018: $250,000
• May 2020: $266,000
• May 2022: $380,000
• May 2024: $389,000
• May 2026: $398,771

Rising home prices increase the size of the down payment you’ll need and the amount you’ll have to borrow for your mortgage. This can price many would-be buyers out of the market.

Sometimes housing prices go down, most notably following the 2008 housing crisis and Great Recession.

Housing supply and demand

When supply is low and demand is high, it’s considered a seller’s market because buyers must compete against each other. Buyers may choose to waive common contingencies and offer a higher purchase price to make their offer stand out.

When supply is high and demand is low, it’s considered a buyer’s market. This can give buyers more leverage to negotiate the price and ask the seller to reduce it.

Currently, the U.S. housing market is considered a buyer’s market. In May 2026, 46% of sellers gave concessions to buyers, up from 43% a year before.

Home sale trends

Another housing market indicator to pay attention to is how long it takes to sell a house. According to May 2026 Redfin data, the median number of days homes spent listed on the market was 49.

Only 25% of homes sold above listing price, and 20% saw price drops, both slightly lower than the same time last year. Price drops can give buyers a greater advantage when it comes time to negotiate price.

There are also seasonal trends that affect the timing of a home purchase. Spring and summer tend to be the most competitive and the most likely time to find yourself in a bidding war. Fall and winter tend to be slower with better prices and less competition.

How to decide when to buy a house

Once you've examined your finances, your needs, and the current market, there are times when it makes sense to buy now and others when it might be best to wait.

When you might want to buy now

It may make sense to buy now if:

• You have saved enough money to cover the up-front costs
• You have enough stable income to keep up with mortgage payments.
• Your credit score and DTI meet lender requirements.
• The house you’re looking for falls in your price range.
• Interest rates are low or dropping.
• You plan to live in the house for a long time.

When you might decide to wait

It may not be the right time for you to buy a home if:

• Home prices and mortgage rates have priced you out of the market.
• You would benefit from saving up for a larger down payment.
• Your credit score or DTI doesn't meet lender requirements.
• You’re experiencing changes in your job or income.
• You plan to move again in the next few years.

FAQ

Here are answers to common questions about when is a good time to buy a house.

Can I be ready to buy a house even with a low income?

Buying a home with a low income is possible if your budget and savings can cover your mortgage payment. You also can consider down payment assistance programs and other government-backed mortgages like FHA loans. The mortgage calculator from Rocket Mortgage can help you figure out a home price and down payment that fit your home buying budget.

How far in advance should I start preparing to buy a home?

The time it takes to buy depends on your financial readiness and the supply of homes on the market. While the home buying process takes an average of 45 to 60 days, you'll likely want to start planning at least 6 months to a year in advance.

Should I wait for interest rates to come down before buying a house?

While mortgage rates have changed, even the best forecasters don't know what the future holds. If current rates prevent you from being able to afford a mortgage, then you’ll need to hold off. If you can qualify for a mortgage you can afford, you could refinance if rates drop in the future.⁴

What happens to the housing market if there’s a recession?

A recession is a downturn in the economy that lasts at least 3 months. While every recession is unique, it can result in reduced competition from other buyers, as well as lower interest rates and housing prices.

Is it better to wait until a buyer’s market to buy a home?

In a buyer's market, buyers have an advantage that can help them get a better deal on a home. However, you can't control the market, and you should also consider your personal timeline. An experienced real estate agent can advise you on how best to time your home purchase, given current market conditions.

The bottom line: Is it a good time to buy a house?

In an ideal world, the time when you decide you're ready to purchase a home would coincide perfectly with a buyer's market. If inventory is high and mortgage rates are low, you could get a great deal on a home. Unfortunately, the market is always changing, and many factors are beyond your control. The right time for you to buy a home will also depend on your personal timeline and financial readiness. Be sure to consider your budget to understand what you can afford.

If you’re ready to start your home buying journey, start an application with Rocket Mortgage today.

¹ To qualify for this offer, you must meet all standard FHA eligibility requirements. In addition, your total mortgage payment, including taxes and insurance, cannot exceed 38% of your income, your debt-to-income (DTI) ratio cannot exceed 45%, and you must have 12 months of verifiable housing history immediately prior to your application, no late payments 30 days or greater in the last 12-months, and no derogatory marks on your credit report. Not available on jumbo loans. Asset statements may be needed, no more than 1 day of non-sufficient fund fees are allowed in the most recent 2 months prior to application. Additional restrictions/conditions may apply.

² The 3% down payment option is only available on certain conventional loan products and is not available in all states. Additional terms and conditions may apply.

³ Rocket Mortgage is a VA-approved lender, not endorsed or sponsored by the Dept. of Veterans Affairs or any government agency.

⁴ Refinancing may increase finance charges over the life of the loan.