As a prospective first-time homebuyer, the idea of purchasing a home may seem daunting, especially in the current real estate market. However, with proper planning and preparation, you can make your dream of owning a home a reality.
Is Now the Right Time to Buy?
Many potential buyers are concerned about the current market conditions, particularly the increase in interest rates on home loans. While it’s true that rates have risen over the last 18 months, waiting for rates to decrease may not be the best strategy. Housing prices are on an upward trajectory and no one knows if the rates will continue to go up or down next year. What we do know is that housing prices continue to increase. Nationally, home prices have increased 7-8% a year, and locally, Bend has increased an average of 9% per year when we look at data from 2014-2023.
If you wait and try to time the market you will most likely pay more and might have to compete with multiple offers and the heartbreak of not getting the home you want. If interest rates do come down, you have the option of refinancing at a lower rate. You won’t have the option to buy that house at a lower price. We live in inflationary times and over the last 40 years, real estate has proven to be the number-one asset class as a protection against inflation.
Embrace Financing Options
As a first-time homebuyer, you have access to various loan programs designed to assist you in purchasing a home. Loan officers can help you explore payment assistance programs tailored to your unique financial situation. Realtors can also negotiate with sellers to cover your closing costs or lower your interest rate. New construction builders are currently offering incentives to attract buyers, so it’s worthwhile to consult with your Realtor about these opportunities.
Affordable Housing Initiatives
Bend offers several fantastic opportunities for first-time buyers through local affordable housing organizations. Programs by Rooted Homes, Thistle & Nest and Habitat for Humanity aim to create homeownership possibilities for households at or below the area’s median income. Many of these organizations conduct lottery home reservations, making land-lease homes an affordable option for ownership.
Think Outside the Box
If you have your heart set on homeownership but find your dream home financially out of reach, consider alternative paths to property ownership:
- Co-Buying: Partner with a friend to jointly purchase a property, making it more affordable for both parties.
- House Hacking: Buy a house and rent out a room to help cover your mortgage, then sell it after two years with the equity you’ve built up.
- Manufactured Homes: Explore the option of purchasing a manufactured home in your desired area, typically at a lower price point.
- Turn-Key Properties: Consider a turn-key townhome that you can rent out for additional income when you’re ready to move to a different property.
New Home Next Year. It’s Possible
Achieving your dream of homeownership is possible, even in today’s market. The critical step is to create a well-thought-out plan. I can help. Visit newhomenextyear.com to learn more.