Real estate industry observers saw the imressive trend in the homes market in 2015 - the comeback of the first time buyer!... 2016 in building on that strong sentiment!!
First time buyers have largely been absent from the housing market for many years now. The improved economy appears to have done little to attract them in significant numbers since before the Great Recession. Until now, however...
Rising rental fees, looser lending standards, including the introduction of 3% down payment mortgages for qualified buyers, more choice, better affordability and the continuation, for now, of very low mortgage rates is creating a perfect storm of circumstances that is quickly gathering to make 2016 a major comeback year for the rookie home buyer.
This will be an incredibly welcome development, not least as it will create a more fluid sale chain, making it easier for those existing owners in the starter homes sector to think about upgrading, thus stimulating the entire market.
If you have been on the fence about taking the plunge into home ownership, here are five great tips to help you get started: -
Evaluate Your Needs - Be it a single-family home, townhouse, condo or any other type of dwelling, it's crucial that you weigh up the pluses and minuses. These will, of course, vary from first time buyer to first time buyer. It is therefore very good practice to sit down and decide on exactly what your initial home ownership goals are, including neighborhood and size, even bathroom layout and what features you'd like in your kitchen.
Cheap Isn't Always Cheerful - You may want to consider purchasing a "fixer upper" style of home that comes at a very good price, but needs some blood, sweat, tears and, of course, extra money to become the home you've dreamed of. You may be saving on the purchase price, but make sure that you microscopically assess what needs to be done to remodel the home, so you don't end up spending more than you would in buying a more expensive property in tip top condition and with the features you desire already in place! It's a very easy trap to fall into.
Obtain Pre-Approval for a Home Loan - This is absolute solid gold advice for any home buyer, but arguably even more important if you're a first timer. Pre-approval means that you will receive a conditional commitment in writing for an exact loan amount. This will enable you to look for a home at or below that price level. Obviously, this puts you in an advantagous position when dealing with sellers, who will know you're a genuine and serious potential buyer.
Work Out What You Can Afford - Just because you qualify for a certain level of home loan doesn't mean that you should take it to the max. Sit down and evaluate all your outgoings and financial commitments. Remember that owning a home differs from renting in that you have to pay property tax and insurance and don't forget your closing costs when you buy the home either. Unlike when you rent, upkeep of the home is also your responsibility so make sure you have an adequate budget for likely ongoing maintenance needs.
Get A Professional On Your Side - At Everest Peak Realty, we know that buying a first home can be a daunting prospect, not least because we have gone through this hugely significant rite of passage ourselves. Fortunately, however, we have developed considerable expertise in this field and can guide you every step of the way, including introducing you to an expert lender who can provide you with the best available assistance on all financial aspects of home purchase.
So if you've made a resolution to take the plunge in 2016 - call us today and get things started in a very positive way.
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