How To Know If You’re Ready to Buy a Home
If you’re trying to decide if you’re ready to buy a home, you probably have a lot on your mind. You’re thinking about your finances, today’s mortgage rates and home prices, the current supply of homes for sale, and juggling how all those things will impact your choice.
While housing market conditions should be a factor in your decision, your life and finances are even more critical. As an article from NerdWallet says:
“Housing market trends give important context. But whether this is a good time to buy a house also depends on your financial situation, life goals and readiness to become a homeowner.”
It’s essential to focus on what you can control instead of trying to time the market. Here are a few questions to clarify whether you’re ready to move.
Do You Have a Stable Job?
How stable do you feel your employment is? Buying a home is a big purchase, and taking out a home loan can feel like a significant obligation. Knowing you have a reliable job and income coming in will put your mind at ease. As NerdWallet explains: “A mortgage is a big commitment . . . Wait until your employment is stable before thinking about buying a house.”
What Can You Afford?
The Just Say Home KC Team is connected to NUMEROUS lenders to ensure you know what you’ll need to save and what you can expect to spend on your monthly payment. They’ll be able to tell you about the pre-approval process and what you can borrow, current mortgage rates and approximate monthly payments, closing costs to anticipate, what percent of the home purchase price you’ll need for a down payment, and more. You don’t necessarily need to put 20% down unless it has been specified by your lender or loan type. As Down Payment Resource says: “A 20% down payment on a home is great, but . . . Many mortgages require no more than 3% to 5% of the purchase price as a down payment. Plus, there are loans and grants that may help cover these costs.”
Are you wondering what payment assistance is available in the Kansas City area? Our Just Say Home realtors can give you all that valuable information! The best part is you may find out you’re closer to your goals than you realized.
How Long Do You Plan to Live There?
How long do you plan to live in your new home? It takes time to build equity in your home by paying down your loan and home price appreciation. You may only recoup your investment if you plan to move quickly. For example, if you want to sell and move again in a year, now might not be a good time to buy. As a recent article from CNET says:
“Buying a home is a good idea if you’re planning to stay put for at least three years. Home values typically increase between 2% and 5% annually, so you could end up paying more in closing costs than you’d earn in proceeds if you sell after only a year or two.”
So, think about your future. Suppose you plan to transfer to a new city with an upcoming promotion you’re working toward or anticipate moving closer to loved ones soon. In that case, these are essential factors to consider moving forward.
Above all else, the most critical question is: do you have a team of real estate professionals in place? If not, finding a trusted local agent and a lender is an excellent first step. The Just Say Home KC Team are Kansas City real estate experts eager to help you answer these questions and find the perfect home!
If you’re trying to decide if you’re ready to buy a home, these questions can help. But ultimately, your best and more reliable resource is the help of trusted real estate professionals.