First Time Home Buyer

Can the financial news get any more depressing? We are being reminded constantly by the media of who bad the economy is and you may be feeling that now would be a bad time to consider buying that first home. Gas prices are near record highs and inflation continues to increase faster than our incomes and the jobs are going by the wayside every day not to mention that real estate is being pounded by adjustable rate mortgages that are beginning to reset and result in higher payments and an increase in foreclosures. With all of these things is it really a good time to buy a house? The answer is absolutely!

It is true, many will tell you that the outlook to buy a new home is grim at best and reports say that existing home sales will decrease nearly 7% this year. Additionally new home sales are decreasing about 3 times that and it is getting so desperate that some developers are offering unique and extravagant deals on homes including two for one deals. Still, if you have available funds to secure the financing this is a great time to take advantage of all the incentives and buy that first home. The housing crisis is more of a problem for the individual who needs to sell an existing home before being able to buy a new home; for the first time home buyer they avoid that and can just buy.

No funds right this minute? That is probably OK because the housing problems is expected to continue for the next 2 - 3 years and therefore you have time to prepare. There is currently and is expected to continue to be a significantly higher number of available homes than qualifying buyers. This means that the first time home buyer who has good credit and a down payment can benefit with a large choice of homes that are selling for great prices; a market view that is called the buyers market.

Buyer’s Market

A large number of homes for sale, fewer people buying homes, home prices dropping continuously and interest rates not out of control yet; these are just a few incentives to buy now. Throw into the mix the deals and incentives the developers, builders and real estate agents are adding to the mix to try to move the homes and move new owners in and the tax credit from the government and how can you not buy now? Still not sure if you are ready? Ask yourself a few questions: Is your credit score in good shape or can you easily raise your score? Do you have assets that you can liquidate to get a down payment? Do you qualify for the incentives? If you answered yes to these questions you could be moving into your dream house this year. Additionally, with the buyer’s market you are almost guaranteed to be able to buy more house than in years past. So stop holding out…buy now!

First time home buyers are facing a number of barriers to becoming first time home owners today. Included in these barriers is the current market, the increasing cost of a down payment and a lack of confidence in today’s economy. These barriers are very real to everyone looking to buy homes; however, they are not insurmountable. Most adults admit to finding home buying intimidating and money related issues are a big concern that often makes the potential home buyer back off. Many have concerns about finding the right home and find the entire process to be intimidating. Being able to shop for homes online and obtain as much information about the home and the neighborhood without the pressure of a sales agent is appealing to the people intimidated. Some of the top real estate agencies in the industries have addressed this concern by delivering a large and fresh collection of listings with new features that allow the buyer more options to remove the uncertainties they may have. By providing comprehensive information with relevant tools and links to local realtors online realtor sources help make the process of buying a home easy and less stressful. The first time home buyer is looking at the area differently today. Naturally the rate of crime is still a top concern; however, being close to daily conveniences is a close second. This is due to environmental concerns as well as the ever increasing price of gas. The home buyer of today is willing to sacrifice cultural and recreational amenities for environmentally green features over buying other houses in today’s housing market. The importance of community and concern over gas prices are evident as buyers look for accessibility with just a small percentage of home buyers being willing to sacrifice the closeness to work and shopping. Green features such as solar panels and energy saving appliances are more important than the more luxury amenities.

Understanding the mortgage as well as the entire financing process during times of change is a major issue and barrier of the first time home buyer. The majority wish the process of taking out a mortgage was easier to understand. Some of these buyers report that understanding financing and the uncertainty of the lending process is the most intimidating part of buying a home. The recent changes in the percentage of down payment required for a mortgage is a major issue for many buyers as well. The lack of money for a down payment prevents around a quarter of buyers from buying a home; more even than buyers with poor credit, low income or lack of confidence in the economy.

The majority of first time home buyers will make sacrifices to save money and earn extra money to be able to buy a home in today’s housing market. These sacrifices include spending on personal luxuries, clothes, shoes and accessories. Buyers are willing to go out less often, clip coupons and even cancel vacations to buy that first home.