“Winning” is in, and losing has never been a good thing.
Whether you are a first time home buyer, repeat home buyer, downsizing, or a property investor, you probably have fears, and they most likely revolve around losing.
Losing out on a good deal, losing equity in your home, losing a low interest rate, losing a bid on the home of your dreams or losing your home all together, not to mention losing your mind trying to figure out when the market has hit bottom.
All of these fears, along with buying a lemon and not understanding the home buying process, are valid fears for many consumers.
The housing market was changed forever by the banking crisis, and the days of a home creating instantaneous wealth have been replaced by fears of losing equity or losing the house itself.
Housing is not a quick-in, quick-out investment. According to Harvard University’s Joint Center for Housing Studies, the rate of return on a housing investment increases the longer it is held.
The decision to buy a home versus renting has to be driven by your lifestyle choices and priorities rather than solely as a piece of your investment portfolio.
Having said that, there are many tangible and intangible benefits to home ownership, such as mortgage interest and real estate tax deductions, forming long and lasting ties to a community, a measure of privacy and security, and a positive effect on family life.
Another Harvard Housing Study states the children of homeowners do 23 percent better in school.
Trying to predict the market when even the best economists in the world struggle, can make the home buying process even more overwhelming.
The bottom of the market will only reveal itself when home prices begin to rise. Take into consideration where the overall cost of the purchase may be headed to make the best financial decision.
If prices were to come down 10 percent, but interest rates increased by 1 percentage point, you would end up with the same monthly payment today versus waiting.
If home prices remain the same but interest rates rise, it will cost you more to buy the same home. If job security is a fear, you should seek out a loan program that offers job loss protection insurance.
Just as you seek a medical professional to alleviate your fears about a complicated medical issue, you should seek the services of a professional real estate agent that is a Realtor® to alleviate your home buying fears.
Find a Realtor that will listen to your fears, identify false fears and work with you to address the valid ones, and walk you through the entire process.
To be a “winner” when buying a home, you will need to make a lot of hard, responsible decisions. Purchase your home as an informed consumer, with the right people working in your best interests.
Choosing the right Realtor should be the first important and wise decision you make.
—Cape May County Association of REALTORS®, Inc.
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