3 Tips for Spring Home Buying
3 Tips for Spring Home Buying
In Hamilton Mill and many other parts of the country the busy spring home-buying season is already underway—March typically ushers in a significant increase in home searches online. This year, even more people than last year are jumping into the search process as a result of improving financial circumstances, like a new job, or life events, like a new baby.
That said, many report that it’s still difficult to find a home that fits their needs and budget. That means this process may take longer than you expect. So, like the Fed keeps telling us, be patient. And be prepared.
1. Consider your alternatives
Mortgage rates are low for now, but they’ll be moving up, and likely remain volatile, in the months ahead. In any case, the average interest rate you see in the news is not necessarily the rate that will apply to you.
The specific rate you get is a product of several factors, including the lender, the loan type, when you applied, the home and its location, the nature of the purchase, and, of course, your credit history and financial circumstances.
What you can afford to buy is significantly affected by the specific mortgage options available to you. A 10-basis-point difference on a mortgage rate has a 1.2% impact on your monthly payment, so what seems like a minor difference from one rate to another can really add up. Plus, if you can’t afford a 20% down payment, you’ll also face mortgage insurance premiums that get added to the monthly payment.
Due to recent changes by housing agencies, you now have more options for low-down-payment programs and even lower mortgage insurance premiums than were available just a few months ago. But that also means you need to think through what is best for you and your circumstances. Our Mortgage 101 crash course is an excellent way to quickly learn the basics about mortgages.
2. Consider new construction
If you are considering moving outside of the Hamilton Mill area, and shopping in an area where new homes are being built, don’t assume a brand-new home is out of your price range. While new-home prices have indeed increased at a faster rate than existing-home prices in recent years, that’s partly because low demand from first-time buyers encouraged builders to feature bigger and more expensive homes. In some parts of the country, we are seeing builders open up more affordable communities.
For example, in markets like the greater Cincinnati; Chicago; Washington, DC; and Raleigh, NC, areas, substantial portions of new homes for sale are within budget for households earning the median income for the area.
3. Consider an expert local Realtor
The single best piece of advice I can give anyone looking to buy a home is simple: Find an expert local Realtor® to help you through the home-buying journey. All three of those words are important.
When I say “expert,” I mean a professional with substantial experience and insight. This is critical to helping you find the right neighborhood and home, negotiating the best deal for you, and completing the process as smoothly as possible.
“Local” means someone who knows your real estate market, neighborhood, and streets intimately.
And finally, “Realtor” should not be taken for granted as just another name for a real estate agent. A Realtor is a real estate professional who is a member of the National Association of Realtors® and subscribes to its strict code of ethics. That standard of professionalism is important.
Congratulations on making it to this point! You may have weathered an economic storm, but now you’re able to consider buying a home. Buying a home is a journey, but if you follow these tips, you’ll be well on your way.
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