With the housing market in constant change, you may be wondering if this is the right time to rent a home or buy a home? Try considering these scenarios to decide if you are ready to buy or if you should continue renting.
Do you have a down payment?
Not all mortgages require a sizeable down payment but having one ready can greatly increase your chances of getting approved for the loan. It can also lower your monthly payment, which will make your mortgage easier to afford in your budget.
Can you afford the mortgage?
One of the most important things that your lender will want to know is whether or not you can afford to pay your mortgage each month. Depending on your area, a mortgage may actually be less expensive than rent. But consider that you will be required to pay all utilities, homeowner association dues, and taxes. You should also include some room for extra expenses as they come up.
Are you ready for home upkeep?
As a homeowner, you will be responsible for fixing things when they break. Some are relatively minor, like replacing light bulbs or mowing the grass. Other things, like replacing appliances or systems, are much more expensive.
Are home prices increasing or decreasing?
It can be difficult to time your purchase to correspond exactly with the most affordable home prices, but you should at least be aware of interest rates and prices in your area. If interest rates are high and home prices are high, your home may not maintain the high value over years if you do purchase it now. On the other side, if you purchase a home when interest rates and prices are exceptionally low, your home may go up in value in the future. It can be hard to time it just right but your real estate agent can let you know what trends they have seen.