If you’re thinking about buying a house, there are several things to consider. A first-time homebuyer needs to review the market and their personal financial situation to decide if the time’s right.
Here are some of our best tips to help you determine if it’s a good time to buy a house.
Market Factors
Do a little research on the external factors that may impact your ability to buy a home.
- How competitive is the market? Is it a buyer’s or seller’s market? During a buyer’s market, you may be able to negotiate a lower price and more concessions from the seller.
- How high are interest rates? Look at what interest rates are and how they’re trending. If they’re rising, and you don’t buy now, you could end up spending more on your mortgage later.
- What are home prices doing? Just like interest rates, home prices fluctuate. If prices are rising and you aren’t in a hurry to buy, you might decide to wait it out.
Personal Factors
Even more crucial than external factors, your budget, income and financial expertise have a big influence on determining if it’s a good time to try your hand at homeownership.
- How much do you have saved for a down payment? If you have a hefty down payment socked away, this opens up more loan programs to you and may be a sign you’re ready to purchase a home.
- How secure is your job? A shaky job that doesn’t offer full-time hours or stable pay may thwart your homeownership hopes. In addition, if you may be transferred in a year or so, it may not make sense to buy right now.
- What’s your credit score? Creditworthiness is a big deal during the mortgage process. If you’ve managed your credit wisely, it may be a prime time to invest in a property.
- How much debt are you carrying? If you’ve kept your credit card balances low and haven’t incurred many debt obligations, buying a home may be well within your budget. That’s not to say you need to be debt-free to buy a house, but you do need to be able to qualify for the loan when your income is compared to your payment obligations.
- What are you paying in rent? Your monthly rent is a factor, too. If you’re paying sky-high rent, putting that money toward a mortgage makes more sense. However, if your rent is reasonable, you have roommates, or live with your parents, you might decide to wait before you purchase a home.
Buying a home is a big decision that offers big rewards. If you’re trying to decide if the time is right for you, talk to a professional loan officer. They can examine your financial picture, explain the market trends and lay out your options.
MIG has been getting first-time homebuyers in houses for decades. If you’re a first-time homebuyer, contact us today.
