More and more millennials and the up and coming Gen Z’s dream of home ownership. Unfortunately, many of the young people today carry large student debt. Home ownership is achievable by following these three simple steps.
- Learn to live on a budget. Know exactly where and how you are spending your money. It is so easy to budget with all of the free apps available today. Prioritize your spending, downsize what isn’t necessary, and know what sacrifices, such as stopping at the coffee shop and going out to eat, you are willing to make in order to pay off your debts and save money.
- Build your credit history. Stay on top of your student loan, car loan, and credit cards. Make sure to pay them off each month on time. If you don’t have any loans or a credit history, open a credit card, use it, and pay it off each month.
- Automate a down payment savings. Have a designated amount of money automatically deducted from your paycheck each month and deposited into a house fund account. Keep the account separate and don’t touch it until you are ready to purchase a home.
Although, there are loans available for no money down, it will be necessary to have available funds for closing costs and miscellaneous expenses such as inspections. A sizable down payment with a good credit score can reduce the interest rate on the loan for your home purchase.
All good things in life, require a few sacrifices and work. Home ownership is achievable, you just need to take the proper steps to get there.
Many Sellers fear the home inspection once they accept an Offer to Purchase and wait with baited breath for the report. There are several steps Sellers can take to reduce their stress.
1. Disclose , disclose, disclose. Anything that gets disclosed on the Real Estate Condition Report won’t be held against the Seller because the Buyer is made aware of the possible defect or issue.
2. Practice home maintenance. Don’t put off repairs for a later date. Replace light bulbs, check all outlets to make sure they are in good working order and grounded, unclog drains, fix leaky faucets, and install smoke and carbon monoxide detectors. Check electrical boxes and wiring for mice damage.
3. Check all windows. Make sure they all open and stay open. Repair any cracked panes or sashes.
4. Although an inspector isn’t there to check on your cleaning skills, a nice clean house shows it is well cared for and not subject to neglect.
5. Have your own pre-inspection. While most Buyers should order and pay for there own inspection, a pre- inspection allows Sellers to fix any issues that may affect the sale or to disclose them in the Real Estate Condition Report. A pre-inspection by the Sellers is especially beneficial in a Buyers market when the inventory exceeds the number of Buyers.
Although a well maintained home doesn’t guarantee any surprises during the home inspection, it can eliminate larger problems and reduce Seller stress. During the down market, I always had my Sellers order a pre- inspection. As a Seller, I followed my own advice and discovered that our chimney needed to be repaired by a professional. The pre- inspection actually eliminated the Buyers inspector from finding any defects.
The old adage, buying a home isn’t for the faint of heart, still holds true. No matter how much you prepare, make your lists, and visit neighborhoods, you still need to wait for the right home to come on the market. Even then, it may not become yours.
The inventory of homes for sale remains low with the number of potential Buyers high. That doesn’t mean you won’t find a house. Most importantly, you need to be prepared to make a strong offer when you do find the home for you and your family. Many sellers won’t even entertain an offer without a pre-approval letter, so meet with a local lender and have your letter in hand. It makes for a much stronger offer.
Be flexible. Flexibility also makes for a stronger offer. Asking the Seller when the best time for them to close and move might make your offer more attractive to them. Also, if you are looking for the typical 3 bedroom 2 bath home in a highly sought after neighborhood, change your search a bit. You might want to open yourself up to a home that needs a bit of renovation or is in a neighborhood that is up and coming. Expanding your horizons opens up new opportunities.
Lastly, be patient. Keep at it. It takes time to find your perfect home so don’t get discouraged. If you lose out on a home or two, it wasn’t meant to be. Speaking from personal experience, usually you end up with a better home than the ones you lost bids on. Be patient. It will happen!