Will you regret the house you bought now in five years?

Despite the turbulent conditions of the 2023 housing market, HousingWire reports that buyer demand is increasing in nearly every region of the country. But whether they realize it or not today, five years from now, some of those buyers will wish they had kept renting.

The combination of high interest rates, low inventory and inflated prices is a recipe for buyer's remorse.

But it does not have to be that way.

GOBankingRates spoke with real estate professionals who explained why some buyers will regret becoming homeowners in 2023, why others won't — and what you can do to land among those looking back on their decisions and smiling half a decade from now.

Low inventory and high rates will account for most of the future regret

Although prices are still high in most places, many of the hottest markets have cooled significantly for two reasons, both of which may have today's buyers wishing they'd waited five years from now.

Low supply means buyers in 2023 could see their home values ​​fall in the coming years

According to HousingWire, all 12 of America's Federal Reserve Districts are experiencing inventory shortages. Not only have builders failed to produce enough new construction to meet demand, but owners locked into historically low rates in the post-pandemic period have little incentive to sell.

"With limited housing inventory and high demand, many markets have experienced a significant increase in price," said Gary Parker, licensed realtor in Utah and founder of GaryBuysHouses. “Buyers may find themselves in competitive bidding situations, which will lead them to bid more than they initially planned. This scenario raises concerns about overpaying for a property, which could lead to regret if prices experience a correction in the coming years."

You will spend most of those 5 years paying the bank, not yourself

Another potential reason for regret is today's high interest rates, which currently stand at about 7% for a 30-year fixed mortgage. Compared to the lucky ones who pounced on sub-3% rates in the post-pandemic months, today's buyers have far less purchasing power, potentially forcing many of them to settle for a home that isn't their dream home.

Then, there is the regret of paying so much money to the bank.

"Higher mortgage rates can result in significant interest payments over the life of the loan," Parker said. "Buyers should be aware of the long-term costs associated with their mortgage and carefully assess their financial ability to manage these payments."

Prepaid mortgages are interest-bearing, meaning your early payments are often interest.

Even if today's buyers finance when rates drop in a few years, their amortization tables will show they've paid tens of thousands to the bank while barely changing their principal.

Like stocks, trying to time the housing market is a fool's errand

Many potential buyers are looking forward to next year, hoping interest rates may ease, and builders and sellers may add much-needed inventory to the underserved market.

But the past proves that no one knows what the future holds.

Veteran real estate investor Andrzej Lipski of Next Door Properties in Connecticut owned properties more than two decades ago when interest rates were between 6% and 8%, like today.

"At the time, these rates seemed reasonable," he said. “I had a property in Springfield, Massachusetts that I bought in 2001 for $140,000. Due to life changes, I sold it 15 years later in 2016 for $150,000. During the financial crisis, the home's value dropped as low as $110,000. Today, just seven years later, it is currently valued at $300,000. If I were to hold it for the long term, I would double my money. This shows that it is impossible to predict where the market will go and long-term holding is stronger than trying to time the market."

You will not regret your decision if this is your time to buy

Settling for a high interest rate or paying a price you know is inflated is a hard pill to swallow. But this is the reality of 2023 - if you find the right home and are now in a position to buy, then this is your year.

"Homebuyers will regret buying a home only if they have made too many concessions," Lipsky said. "Forgoing inspections or buying a house that a buyer can't afford are the two biggest mistakes a home buyer can make."

If you avoid these pitfalls, your chances are good even if you're one of the many buyers in 2023 who paid a premium for the keys to one of the few homes on the market today with a lack of inventory.

"If the house is what you dreamed of, paying 10% to 20% above the asking price while being able to afford it will not cause regret," Lipsky said. "This home over 20 years or more may increase in value and the memories they will make in this home will be priceless."