A large part of building wealth involves delaying gratification. Therefore, you might find yourself wondering whether to buy your dream home now or wait for a better price.

But what if you wait too long and your dream home disappears forever? You might end up kicking yourself later for trying to save money when you could be living a better life today. Ah, the one that got away—one of life’s big regrets.

At the same time, what if you buy your dream home and the price continues to go down in value over the next several years. You might also end up kicking yourself for not having the patience to wait just a little bit longer.

When you label a home as your “dream home,” emotions run high, which isn’t ideal for striking a good deal. If you’ve found your dream home, chances are high that others want it too, often leading to bidding wars. But overpaying, as many did before the global financial crisis, can lead to regret.

This post will explore the dilemma of whether to buy the ideal home at an unideal price or wait for a better price. I’ll argue both sides and try to reach a conclusion with a logical framework.

Arguments for Waiting for a Better Dream Home Price

Here are four reasons why you should wait for a better price or better affordability before buying your dream home.

1) Plenty of Dream Homes to Choose From

Although you’ve found your dream home, know there are plenty of other dream homes out there. Financial discipline is key when buying the most expensive thing in your life. Think back to all the other homes you once thought were ideal. Even if you missed out, you still found new incredible homes. In real estate, there’s always something nice that pops up if you wait long enough.

The reality is, there is no such thing as a perfect home. It could always be bigger, have better views, more light, more floors, more land, and more amenities. If you miss the current dream home, get excited about another one with different features waiting for you in the future.

You only have to wait 1-5 years before the next dream home comes to market. Or you might have to wait 12 years or longer, the average homeownership tenure, for that exact dream home to come up for sale again. While you wait, save aggressively and invest your down payment wisely. This way, you’ll increase your choices and bolster your chances.

2) Losing Money on a Home is a Heavy Psychological Burden

Perhaps the most important reason to wait for a better price is to avoid financial loss. Buying at the top of the market can weigh on you mentally and emotionally. You may constantly scold yourself for not having the discipline to wait.

If you’re unable to buy your dream home based on a responsible home-buying guideline, then you must not cross the line. Doing so could jeopardize your finances, putting your family, happiness, and entire future at risk. A home is just an asset to provide a better life. Use the dream home that got away as motivation to work harder, save more, and invest more aggressively.

I foolishly bought a vacation property in 2007 in Lake Tahoe, thinking I got a good deal, paying 12% less than the seller paid a year earlier. But the global financial crisis caused the property to lose another 50% of its value at the lowest point. I felt terrible about this purchase for a decade.

3) Real Estate Downturns Take Years to Bottom

If your existing home is good enough, what’s the rush to buy, especially after a large run-up in prices? Real estate downturns always occur and take between one-and-a-half and three years on average to play out. In the past, downturns lasted around four-to-five years, but cycles are shorter now due to technology.

The dream home you’re currently salivating over may not be available years from now, but there will surely be other dream homes in the future. During normal real estate downturns, inventory tends to balloon, giving homebuyers even more options.

Yes, the dream home will still garner a lot of demand in a downturn. However, the competition will be relatively easier. Every year you wait is another year of saving and investing for an even nicer home.

4) You’re Young with a Highly Uncertain Future

To buy the dream home, you must be certain you plan to live in the area for at least five years, preferably 10+. If you’re still relatively young (under 35) with an uncertain career, skip the dream home for now. Don’t lock yourself into an expensive asset in case your work brings you to a different city or country.

If you’re still single or uncertain about spending a lifetime with your current partner, waiting until there’s more relationship certainty is better. There’s no need to buy a dream home if you’ve got nobody to share it with. Then again, your dream home might be a simple one-bedroom condominium with a river view.

In 2005, at age 28, I bought a handsome single-family home on the north side of San Francisco with all the money I had. Partly due to having a relatively large mortgage, I turned down a lucrative job opportunity in NYC. Selling the home in 2010 for a loss didn’t feel good. I’ll always wonder how my career would have turned out had I returned to NYC.

The feeling of regret will gnaw at you if you’re not careful.

Arguments For Buying The Dream Home Today

Here are five reasons for why you should buy your dream home today if you can.

1) You’re an Experienced Buyer Who Knows What You Want

If you’ve been house hunting for more than five years, you’ve seen enough homes in your price range to know what you want. If you’ve stumbled across your perfect dream home, buy it if your finances can support the purchase. Follow my 30/30/3-5 home buying rule.

If you’ve truly found “the one,” don’t let it slip away! Fight like hell to buy the home because it may never appear for sale again. Prime properties in prime locations rarely turn over.

When these incredible homes get old, they can simply be remodeled with the finest new materials. Any contractor can do the remodeling, but few people can buy these types of choice properties because they are rarely available. In big cities, land tends to be more valuable than the building.

Experience is key in knowing the type of home you want. If you’ve already owned multiple primary residences over the decades, you’re in the best position to identify the perfect dream home when you see it.

2) You’re Tired of Putting Your Life on Hold

You’re not getting any younger. If you let your dream home slip away, you may have to wait the average homeownership tenure of 12 years before it reappears, if ever. By then, how old will you be? Life goes on whether or not you decide to live it up.

Don’t put your life on hold for too long just to save money. Even if prices go down after you buy your dream home, it doesn’t really matter because you’re living the dream! Your house is meant to be enjoyed first and looked at as an investment second. The longest you’ll likely have to wait until your dream home’s price stops going down is about three years.

Your vision might not last forever. Why not buy that dream home with panoramic ocean views while you can still see clearly? Your fur babies might only live for 12 years, so why not own a wonderful home with a large enclosed yard? You’ve delayed gratification for decades after studying hard in college and are sick of waiting any longer.

Your window of opportunity to do and enjoy things is much smaller than you think. Time will sneak up on you if you aren’t intentional with how you spend it.

At 47, I’m unwilling to delay gratification any longer. Plenty of people my age die for unforeseen reasons. If I die with anywhere near my existing net worth, I will be greatly disappointed in myself for wasting so much time and working so much when I was younger.

3) You Have Young Children

The best time to own the nicest house you can afford is when you have children. Ideally, you buy your perfect dream house by the time your kids are three years old. At three years old, kids start to develop memories, and from age five, memories really begin to stick.

Once you lock down your dream home, enjoy it until your kids leave for college or go off on their own. Owning your dream home for 15+ years is a long enough time to ride through any real estate down cycles.

Chances are high, in 15+ years, your dream home will be worth far more than you paid. Even if your home’s price is flat, if you took out a mortgage, you will have paid down a lot of debt during this period.

Having children helps better justify the cost of purchasing a dream home. The more heartbeats you can amortize the cost across, the cheaper the home gets. It’s the same concept as feeling better driving a four-door sedan or SUV when you always have four passengers versus only one or two.

If you can buy your dream home when your children are young, by the time they are adults, it should be paid off. When they start their own families, you could gift one or all of them your home. Then you could right-size to a smaller place.

4) You’ll Make Lots More Money After the Dream Home Purchase

You will most likely have to stretch to buy your perfect dream home. If you stretch too much, you will be house rich, cash poor, which is a stressful situation. However, if you plan to make a lot more money after your dream home purchase, then you’ll feel better after every month.

If you know there’s a large windfall in your future, such as your company’s IPO or a large year-end bonus, buying a dream home today will be safer. Although, such windfalls are never guaranteed, so plan accordingly.

The longer you live in your dream home, the more you will be able to replenish your funds. The greater your funds, the less of an impact a real estate downturn will have on your mental well-being and finances.

Perhaps more comforting, the value of your dream home will decline as a percentage of your net worth over time.

A 30% Of Net Worth Limit

I don’t recommend experienced homebuyers spend more than 30% of their net worth on a dream home for risk control and passive income purposes. At 30% of net worth, you will feel like your home is one of the most amazing properties ever. Once the value of the dream home dips below 20% of your net worth, you will feel a greater sense of security. Ironically, you may start itching to upgrade to another dream home.

Once your dream home declines to 10% of your net worth or less, it will no longer feel like a dream home. Depending on when you bought this home, you might be happy to just live in your home forever because “home is where the heart is.” You’ve made so many wonderful memories that leaving it may feel too uncomfortable.

To be a responsible dream-home buyer, you should have a Reasonable Income and Reasonable Net Worth before paying the suggested Home Price on the left hand column. You could have the Minimum Income or Minimum Net Worth for one variable, but not both. Click the chart to learn more.

5) It’s a bull market and dream homes will only get more expensive

Here is a great dream home example at 4620 Kahala Ave, Honolulu, HI 96816. It features 6 bedrooms, 6.6 bathrooms, and 6,932 square feet of fully remodeled living space on a flat 13,500 square foot lot.

I toured it for fun in 2019 when it was listed for $7.7 million. The market for luxury homes was soft, and I was expecting the price would keep going down. It did, until it sold for $6.95 million in July 2020.

Then, two years later, on May 6, 2022, it sold for $8.795 million! Now, in mid-2024, it is back on the market for a whopping $9.75 million. Let a see if it actually sells anywhere near asking price.

In a bull market, dream homes can get bid up to nosebleed valuations, pricing you out forever. Hence, if you find your dream home and think prices will continue to rise, you might want to seize the opportunity while you can.

The funny thing about 4620 Kahala Avenue is that it’s still not the perfect house. Kahala Avenue is a relatively busy street, the house is in a flood / tsunami zone, and there are only peekaboo views of the ocean on the second level. Meanwhile, the empty lots across the street could be built upon, blocking the remaining views and creating noisy construction for years.

Minimum Recommended Age Before Buying a Dream Home

With so many things to decide, at the very least, wait until age 40 or older before buying your true dream home. At age 40, you will have 22 years of experience after high school and 18 years after college. By then, you will also have likely already gone through the home buying experience at least once before. Your finances will also be much stronger than someone in their 20s and 30s.

Given your experience, you have a strong idea of what you want and what you don’t in a dream home. Further, you’re not as easily overcome by your emotions, such as real estate FOMO. You will make fewer unwise financial decisions in your 40s because you will have already made plenty up until then.

Age 40 is a good age to start spending on things you truly value. Given your life is potentially half over, time becomes incrementally more precious. You start thinking more frequently about your mortality after 40. You also think about the sad potential of dying with too much money.

After age 40, you may also be less concerned about always maximizing the return on your investments. Instead, you’re more focused on living your best life possible with the time you have remaining. The experience of living in a dream home is way more valuable than trying to extract the highest return possible.

Of course, my recommendation of waiting until age 40 assumes you have a great chance of living the median life expectancy for your sex. However, as we all know, life is not guaranteed. If you think you’ll die sooner, then you may want to buy your dream home sooner as well.

The Solution To Buying A Dream Home At A Better Price

Timing any purchase to get the lowest price is extremely challenging. Even if you have 100% conviction in your timing, there might not be a dream home available! If the perfect house does come to market, you could lose it in a bidding war due to high demand.

If you are over 40 and can comfortably afford to buy the dream home using my 30/30/3-5 home buying guideline, then put in an offer. Set your price limit and walk away if a bidding war escalates beyond your limit.

Ideally, for a better price, wait to submit offers for a dream home if the real estate market has been in a downturn for at least one year. If it hasn’t been at least 12 months since home prices started declining, hold strong and continue to wait. This way, you avoid at least a year’s worth of depreciation if you buy. If you can successfully wait for three years, and your dream home is still available, then go ahead and buy with conviction.

In a perfect world, the best time to buy your dream home is during the last month of a real estate downturn. But since you can’t predict when that will be, remember that real estate downturns typically last between 1.5 and 3 years.

Once the real estate market starts rebounding, prices can get bid up quickly, potentially pricing you out of your dream home forever.

My Dream Home Situation

I finally found my dream home at age 45 in 2022.

After buying six properties and selling one, I knew exactly what I wanted to raise my family. So I went for it after 14 months of deliberation when the home came back to market under a private sale. In fall of 2023, escrow finally closed.

My family could happily live in our current home for the rest of our lives. However, after vacationing in Hawaii and seeing several dream homes there, I’m beginning to wonder what’s next!

When it comes to real estate, there is ALWAYS going to be another dream home for sale. All you have to do is look at homes for sale one price point above. After all, there are homes that sell for over $100 million nowadays.

If you buy your dream home, enjoy it as much as possible. Stop searching for nicer homes as they might only serve to make you feel less appreciative of the one you have. The key to happiness is being grateful.

Additionally, celebrate your decision to spend up for a better life. You may have broken free from your hoarding mentality of so many years, which is a triumph in itself.

When the day comes, you probably won’t wish you accumulated more money to bring to the afterlife. Instead, you’ll probably savor all the memories of a life well lived and a bank account well spent.

Reader Questions

Is it better to wait for the perfect time to buy a house to get a better price? The dream home you want might not be available for purchase once that perfect time comes. Or is it better to buy the perfect dream home once it becomes available? The price of the home may continue to go down after you purchase it. However, you’re able to enjoy the home in the meantime.

Invest In Real Estate For The Long Run

To invest in real estate without a mortgage, check out Fundrise. Fundrise operates diversified funds that mainly invest in the Sunbelt region, where valuations are lower and yields are higher. The company manages over $3.5 billion for over 500,000 investors taking advantage of the long-term demographic shift to lower-cost areas of the country.

Financial Samurai is a six-figure investor in Fundrise funds, and Fundrise is a long-time sponsor of Financial Samurai. For most investors, investing in a fund is the optimal way to go.