Mortgage interest rates are still relatively low, but we’ve already seen indications from the Federal Reserve, that they could increase during the remainder of 2017 or in 2018 (and maybe forever after that). At the same time, inflation in home prices is very real in almost all major markets.
Coastal markets and college towns have seen some of the biggest spikes in home prices. Boston, for example, experienced a 11% rise in the last 12 months, while Los Angeles saw a 13% increase over the same period.
Whether or not 2017 is a good time to buy your first home will largely depend on the market you want to get into, what you do for work, and what your plans for the property are going to be. In housing markets where the home prices have remained stable, buying now before interest rates rise further could make sense. In other areas, where prices have already raced upward, it could make sense to wait out the rush and look for more of a buyer’s market. It depends on your preferences and your situation. When bubbles burst, prices fall back to reality, but sometimes that takes quite sometime.
With that said, something to consider is what you're planning to do with your home (live in it of course) over the next few years, and if prices collapse what would that mean for you? If you have a stable source of income, and will be able to afford your mortgage durring a recession, it doesn't matter as much what the value of your home is on paper. As long as you don't need to sell your property and can afford to stay there, you can wait out the market. Thus, if you're buying a house you could see yourself in for a couple of decades, can afford it, and don't plan to move out, you've got relatively low risk should the value of your home fall. If it goes up, well that's just a bonus.
On the other hand, if you're looking to trade up to a better area or a larger house in a few years, you'll need to be wise about timing your entry and picking a location that may still be rising. Predicting future prices is a silly endevour, none the less, cities with high demand for housing are much more likely to continue rising in price, and much less likely to be a severely hit during a general decline in housing prices.