Market prices are rising. Interest rates are low so its a good time to buy BUT, I can’t afford any of the homes on the market right now.
This is a common problem for 1st time home buyers right now. The market is pricing out our young new buyers. So what do we do? Do we wait for prices to drop? Do we just rent forever? Do we move in with mom so we can save more so we can finally afford a home?
NO! There are solutions. Prices my not drop anytime soon. Historically the market has crashed twice, once in the 30’s and once in the early 00’s. If we wait for another crash but prices just continue to go up, and if interest rates go up as well we may price ourselves out of the market for a really long time. Renting forever, living with family, or similar options to save more money are also not great strategies. If the market keeps going up we will need to save more and more money. The best bet is to get something now so our equity is going up as prices also go up.
But wait, I can’t afford to buy now! But wait, maybe you can. There are options.
Some options that have worked for first time buyers just like you have helped some of my clients get into homes this year. Here are a few examples.
- Buy a duplex- You can buy a duplex with a traditional loan and live in half while you rent out the other half. This is a great option to not only start your future investment/retirement goals but also a way to have someone else pay a large portion of your monthly mortgage payment while not having to share your space.
- Go in with a friend- Maybe having a roommate is not your ideal situation, but maybe having a roommate for 2 years while you both build equity and you save up money so you are in a better position to buy a home in the future is a good idea.
- Move out of town a bit. Again, it may not be ideal to add 25 minutes onto your commute, but it is always a good idea to build equity in a property and then transfer that equity to a home that is more ideal. Here in the Vancouver, WA area, it is hard for first time home buyers to get their first home. The prices are just going up, up, up. But homes are more affordable in outlying areas, like Woodland, Kalama, or Longview. And, the best part if you buy there now, the prices seem to be going up faster than Vancouver. As more and more people are priced out of Vancouver, they need to go somewhere.
- Don’t buy your dream home. Buy a stepping stone. Buy a house with the plan that in 2 years you will sell it, take your equity and buy a home more like your dream home. 2 years is nothing, and soon you will be in your perfect home.
If you are wanting to buy your 1st home and feeling like its just too expensive, call Dawn. Even if you hate these plans, there are more strategies to find your perfect 1st home. Dawn has been living in the PNW for the last 6 years and is an expert at helping 1st time home buyers get their 1st home. She is licensed in Washington, Oregon and Arizona and would love to help you! Dawn Workman 480-540-8100 Dawn@DawnWorkman.com