Is Now the Time to Buy a House?
As a real estate broker, I am often asked if it is a good time to buy a house. When people ask me this, they are usually asking about the state of the market. However, your decision to buy a home shouldn’t solely be based on the market, in fact, even greater consideration should be given to your personal situation.
Let’s say that you have been saving for the last several years and think you are ready to buy your first home. How do you know the timing is right? We suggest that you ask yourself:
Am I going to stay in this house for at least 2 years?
Do I have a steady income for the mortgage?
Do I have some savings for the down payment (we prefer that you have 20% of the home price but 5-10% these days will work too) and the closing costs?
Do I have a good credit score and debts to income ratio, so I can take advantage of the best interest rate?
Other bonus considerations:
Am I ready for the responsibilities of owning a home, especially if it is an older home or a single-family home in an HOA community?
Do I have the reserve for 6-month of living expenses?
If you answer “no” to any of the questions, you probably should not buy a home, no matter how good the real estate market is for buyers.