Do First Time Home Buyers Have A Chance In Today’s Market?I’ve been originating home loans for first time homebuyers for over 10 years and I’ve seen the market go up and down several times during this period. However, never have I seen home prices drop this so dramatically as of lately. This is creating a tremendous opportunity for first time homebuyers to take advantage of homes with low prices and built-in equity. What other investment in today’s market can offer such a huge return on your dollar? Stocks, bonds, and even mutual funds are way too risky, but buying low in today’s real estate market offers one of the safest and best advantages for first time homebuyers wishing to buy a home.
Can you imagine, homes that were once valued at $400,000 are now selling for $200,000? In a few more years, these same homes will once again be valued at the higher amount or more. There is no other investment that I know of that can offer this high of a return. Most people must wait their entire their life time to earn enough money in their estate to equal what first time homeowners can gain in equity in one single transaction.
Everyone knows putting aside a little money each month is sometimes very difficult to do, especially in today’s economy. High gas prices, high food prices, practically everything has increased in price, even rent. I don’t know where you live, but to live in a decent house, apartment, or condo in the Fresno area your rent payment will be at least $1,200 – $1,400.00 per month, and Fresno’s housing costs are much lower then most other cities in California. So, the real question is, WHY PAY RENT WHEN YOU CAN BUY? Buying a house has so much more advantages than renting, especially if the amount you are spending on housing is about the same as what it will cost with a home loan. SO WHY RENT?
Ok, ok, I get it! The problem is saving enough money for a down payment, right? Well, there’s more than one way to peel an orange. Believe it or not, someone once got mad at me for saying that. Anyway, whether you go FHA or conventional for a home loan, you will need to have at 3% - 5% of your down payment in your bank account at least 60 days prior to the close of escrow. Let’s see now, 3% of $200,000 equals $6,000.00. Plus you will have to have closing costs, but you can request the seller of the house to pay them for you. Believe me, they would rather pay your closing costs than to have their house sit on the market another month. The bible says, “Ask and you shall receive”. All you need now is the faith of a mustard seed. Now go out and get qualified for a home loan!
