This is a great time to buy, maybe. There is an $8,000 first time buyer tax credit waiting for just about everybody who doesn’t already own a home. Dakota County’s first time homebuyer’s assistance plan will help you make up to half of your downpayment and closing costs when you buy your first home inLakeville. Interest rates couldn’t be lower and can only go up from here. Home prices are near bottom. You have to buy now, maybe.
Buy if you can, but don’t be reckless. Don’t let all the incentives fog the lens and lead you into a bad decision. It’s a lot harder to buy a home you can’t afford today than a few years ago. However, it’s possibly easier to buy the wrong home today. There are two final criteria that I try to get all my clients to consider before buying.
No matter how long you plan to stay in the home, buy only if you could live there forever. Do you think there may be two cars to park in that one car garage sometime before you move? After the future car thing is resolved, count the total number of children in your household as of ten years from now. Add one for surprises, and divide by the number of bedrooms in the home you want to buy. If the number is much higher than one, there could be a problem down the road. The time to make decisions is now, not in four to six years. Consider a place you can live in long term if necessary.
That said, there is a part two: No matter how long you plan to stay in the home, buy as if you will sell it in a few years. There are lots of surprises, good and bad, that could require a sale after just a few years. What’s your strategy for selling? Will you have some backup funds that you could use to pay for selling the home? Is the home likely to hold more value than other homes you have considered? If the only way you can see for disposing of the home in the next few years is a short sale or a foreclosure, you are not ready to buy. Do yourself a huge favor and find a nice rental, save for a while longer, and only buy when you can afford a moderate surprise.
For a free, no obligation, homebuyer orientation and consultation, call me at 612-916-3033.