Buying a home can be an intimidating experience, but the ability to invest
in your home, build equity, and get on the path to owning a home of your
own is a dream for many people. However, the jump from rental to ownership
can be a huge and intimidating task, one which makes a lot of potential
buyers nervous. Because of the uncertainty, there are a lot of myths we
frequently hear from renters. On this blog, we’ll set the record
straight on a few of them and show that home ownership is closer than
you might think.
I Don’t Have a Down Payment
Traditionally, a down payment on a home is thought of as 20 percent of
the home’s total cost. Let’s face it, no matter how large
of small the home you’re buying, that’s a lot of money, and
for first-time home buyers in particular, it’s an amount of money
that you very likely don’t have on hand. Believe it or not, this
is fairly normal, and believe it or not, you
can still get a mortgage with a lower down payment amount. Talk to potential
lenders about their options for reduced down payments—some lenders
will offer mortgage loans with a down payment as low as three to five
percent! These will carry extra fees and mortgage insurance requirements,
so your monthly payment will be more expensive, but if your down payment
is all that’s holding you back, you have more options than you think!
I Can’t Find a Home I Like in My Price Range
Santa Clarita has thousands of homes and dozens of them are for sale at
any given moment. The market changes every day, so while you may not be
able to find something you like that today, that literally could change
tomorrow. That being said, if you’ve been searching for months and
haven’t found something that fits your needs, take a closer look
at your needs to figure out what’s the most important to you: is
a location near good schools important, or are features in your home more
necessary? Also, can you afford a home that matches what you’re
You can find the home you’re looking for, but what you’re looking
for might take some adjustment. Make a list of what’s the most important
to you as a buyer and then start your search again based on that list.
You may be surprised how quickly you find a home that makes you happy
simply by changing your perspective.
The Housing Bubble will Burst
California is in an interesting position in terms of a housing market right
now. Mortgage rates are at historic lows, making loans cheaper than ever.
This has led to lots of potential buyers on the market. However, the number
of homes on the market is still low. When mortgage rates increase, home
prices will have to drop to accommodate for the budgets of potential buyers.
Let’s look at an example: if you purchase a one-million dollar home
here in the hills of Valencia, that same home will have to sell for $900,000
to keep monthly payments the same if interest rates were to rise a single
percent. While mortgage rates will rise eventually, prices probably aren’t
going to drop anytime soon.
I Can’t Compete Against Cash Offers
Anyone who’s selling their home knows that an offer to purchase a
home in cash is usually a much quicker transaction with fewer contingencies
and a faster close. However, they usually also come with a much lower
price tag. Therefore, there are two types of sellers: those who will take
a faster, cash-based sale at a lower cost, and those who want to get the
best price for their home and are willing to work with those who have
a lender. Your realtor is your best ally in these cases, and can work
with your seller, their agent, and your lender to help you craft a deal
that’s ideal for everyone involved, including making your seller
see the benefit of working with you instead of just opting for a cash bargain.
If you’re looking to purchase a home,
Dippy Real Estate can help! We take pride in helping residents of the Santa Clarita Valley
find the home of their dreams and close the sale quickly while getting
the best possible deal. Dippy is passionate about helping her clients
find a home that fits their needs and their budget, and makes the experience
as personalized as possible.
Looking to buy a home? Call Dippy Real Estate today at 661-441-3304 to
set up an initial appointment and start looking for the right fit for you!