Real Estate Information

Sellers are courting them

First-time buyers are getting 'more house' than they hoped for

        Couples and families who have been renting are in for a pleasant surprise when they go house hunting. They won't have to settle for a starter home.

        Half of all home sales last year were to people who never owned a home before, according to the National Association of Realtors. A recent survey shows that they were in for some surprises when they sealed a deal:

        67 percent said they had the opportunity to buy a home sooner than they expected

        50 percent said they found a home in a more desirable neighborhood than expected

        61 percent got a better price than they expected to pay

        40 percent got a larger house than they expected to get 

        43 percent locked in a lower interest rate than expected, according to the Coldwell Banker survey.

        Of course, a similar degree of satisfaction among all home buyers today  is industry wide.

        As with most house hunters, the first-timers looked at about 11 homes before making a decision. Buyers are looking for features that appeal to them, and they have a good selection to choose from.

        Here's a tip for sellers: First-timers are busy people. They want a home that is ready to live in right now with no repairs required. 

Location

        Though buyers say they want a nice location, the fact is that almost any location can be just right for someone.

        It might be closer to their employment or closer to where parents, other family members or friends live.

        In areas that have many rental properties, a young buyer could be thinking of turning a larger home into a duplex for added income.

I'm often asked if this is a good time to buy a home. Some clients are concerned that home prices may fall further than they have already. They are assuming that the best course of action is to wait for the bottom in the market and then buy. The problem with this approach is that you don't know where the bottom is until you see it in the rear view mirror, meaning until you've missed it!

Home prices are one factor in determining your cost of ownership, but so are interest rates and financing availability. Even though interest rates have gone up in the last six months, they are still near historic lows. Since your monthly mortgage payment is a combination of paying down your principal and paying the interest owed, if home prices come down a little further but interest rates up, it could cost you even more to service a mortgage on an identical home!

While a home is a major investment, it is also the center of your personal life. It's important to live in a home that reflects your taste and values, yet is within your financial "comfort zone." To that end, it may be more important to lock in today's relatively low interest rates and low home prices, rather than to hope for a further break in prices in the future.

Please give me a call if I can be of any assistance in determining how much home you can afford in today's market.