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What is Stopping You From Buying Your First Home This Year?
What is Stopping You From Buying Your First Home This Year?
Prices? Interest Rates? Inventory? Something else?
Let’s discuss
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2 Replies
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In my experience these past two years, FTHBs feel like they are getting ripped off due to the steep rise in housing costs, mainly due to low inventory. Skyrocketing rates do not help either. It is our job to get our borrowers to understand the advantages of owning their first home.
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What Is The Reason For Not Making The Investment In Real Estate In Your First Home This Year?
For many, owning a home for the first time is an achievement. However, several issues may affect this decision. Let’s address these issues as the following blocks or barriers to progress:
Price
High Prices In The Market For Purchasers Of Primary Dwellings: It is often hard for first-time buyers to step on the property ladder because home prices are always on the upward trend, which leads to worries about borrowing beyond means or overpaying for a property.
Price Bubbles In Real Estate Markets: In hot property markets where prices are already high because of demand, amplified competition, and multiple bids can lead to considerable price increases, which are not amenable to some buyers.
Interest Rate
Steep Interest In Buy-To-Let Mortgages: High interest rates are a key consideration in a mortgage term and can increase monthly repayments to unjustifiable levels.
Interest Rate Increase: Even an infinitesimal amount can prevent potential buyers from acquiring properties they desire at a price and location they deem appropriate.
Inventory
Low Housing Inventory For Sale: This is a supply-side problem. Because demand is constant and homes for sale are few, finding a home to buy within a certain range becomes an arduous task.
Market Friction: The situation is worse in most areas as the demand is always high.
Financial Issues
Three Months Waiting Period Institutional Credit Through Real Estate: Real estate can be capital intensive. Therefore, getting enough savings for a deposit may take some time and persistence, but this is usually daunting. This holds especially true nowadays when living costs have gone above the roof.
Current Debt Position: Other loans already taken out will limit the chances of acceptance for a mortgage, so all loans must be well managed.
Subjective Readiness
Life Changes. Job loss, a new addition to the family, or a change in aspirations can delay the purchase for some time.
Fear of Commitment. Some people are put off by the obligation of buying and owning a home.
Market Conditions
Economic Uncertainty. Some individuals may be anxious about the economy or their job prospects and may not want to make a long-term investment.
Future Resale Value. Lower selling prices can also turn off buyers, preventing them from entering the market.
Knowing the exact barriers you are experiencing makes it easy to come up with a solution. Be it money, the market and its time, or an individual’s readiness, all of them are worth discussing to take steps toward owning a home. What exactly is making it difficult for you? Let’s explore those further!