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House loan advice

Hello, fellow Redditors!

I'm currently facing a decision that I believe many of you might provide valuable insights on. I live in Montenegro, where the government has announced changes to the tax code expected to result in a minimum 10% salary increase by the end of this year. In my case, the net salary will probably increase from 1200 euros to 1400 euros a month. In our country, real estate prices are high relative to incomes (at least 1700 euros/m2), making it difficult for at least 90% of the population to purchase a home without resorting to a housing loan. The current interest rates for these loans range between 5.5% and 6.5%.

Given these circumstances, I'm contemplating whether to take a housing loan now to buy an apartment in the capital before the anticipated salary hike potentially inflates real estate prices further. However, I'm torn between acting now and waiting to see how the situation unfolds.

I'm particularly interested in advice on:

  • The financial prudence of securing a loan under the current conditions versus the post-salary increase landscape.
  • Any anticipated shifts in real estate prices or loan interest rates in response to these economic changes.
  • Personal experiences or professional insights into making such a decision in a similarly fluctuating economic environment.

Would you recommend proceeding with the purchase now, or would it be wiser to wait and observe the market's reaction to the increased salaries? Any advice, insights, or experiences you could share would be immensely appreciated.

Thank you for your time and input!

submitted by /u/turtlesskin
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source https://www.reddit.com/r/RealEstate/comments/1attcua/house_loan_advice/
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