Buying a home during an inflation or deflation for that matter, is somewhat immaterial compared to your ability to buy in either situation, IMO
During a deflation, the economy is buoyant, giving Buyers more purchasing power, causing rampant competition for homes, and encouraging Sellers to increase house prices; ultimately asking the question of how deep your pockets are.
In an inflation economy, Interest rates go up, Lenders get stingy with mortgage loans, creating less competition among buyers, the market slows down – not crash as some doomsayers would have you believe.
This forces sellers to reduce house prices – I just slashed $50,000 off a home I am currently selling – creating an ideal time to buy; except your creditworthiness and cash flow comes under strict scrutiny here.
So, if you think about it, the decision to buy or not, is heavily dependent 3 things you control and must aspire to improve
- Down payment
- Credit Worthiness (score)
- Income to Debt ratio
The better these 3 aspects are, the more buying power, and better advantage and options you will have, which is why It is important to understand the industry dynamics, and how to navigate it to get the best deal for your current situation – whatever the market condition!
Waiting for the market to crash before buying may simply increase the number of eager buyers, driving up the price of homes, and putting squarely in the same place you started.