It may not be a surprise to hear that the housing market is one of the biggest in the United States, and the total value of all homes in the United States is over $30 trillion. To buy your first home is to enter this huge and varied market, but a first-time home buyer doesn’t have to be overwhelmed by such matters as mortgage rates, credit score, downpayment, or different types of loans ore refinancing. When you buy your first home, this means getting a good mortgage from a reputable and local mortgage company, whose staff will be happy to help you buy your first home. Today’s house buyers are more varied than ever, and they all have different preferences on what sort of home to get. What is there to know when you aim to buy your first home?
Young adults might regard this term with dread, but in fact a mortgage is a very manageable and ordinary part of buying a house in the United States today. A mortgage is nothing more or less than a loan to afford a home, just like how a person may take out an auto loan to buy a car or a pickup truck. On average, new mortgage balances back in 2017 were close to $244,000, and in that year, the average down payment on a mortgage came in around $12,829 or so. This is a common practice; close to 65% of all Americans are paying a mortgage, and the remainder either have fully paid off their homes or are renting their living spaces instead. And there are plenty of houses out there to choose from; nearly 5.51 million existing houses sold across the United States in 2017, according to data available from the National Association of REALTORS. Around 612,000 newly built homes also sold in that year, and some houses are in fact custom homes built to the buyer’s specifications.
After someone has decided on a home to buy, he or she must approach a mortgage company and try to get a loan. A higher credit score is better, since a great score will lower the interest rate on their mortgage. If someone’s FICO score is low, they may face high interest rates, and they may be declined a loan at all. But assuming that a buyer gets a mortgage, they may choose either a fixed rate mortgage or an adjustable rate mortgage (ARM). Most commonly, a mortgage will be paid off over the course of either 15 or 30 years, with a lower interest rate for the former and a higher rate for the latter. Someone with a mortgage may choose to have lower monthly payments in the 30-year model in exchange for paying more overall due to interest. Or, a buyer might choose the 15-year model, which involves higher monthly payments but a lower overall total mortgage payment. A person’s finances, and how long they plan to live in that home, may affect which type of mortgage they choose.
Americans on the Market
who is buying homes, and what do they look for? The most robust home buyers are aged 55 and over, since they have more money saved up and have more experience with this. Still, more Millennial home buyers, those born between 1982 and 1995, are entering the market, and this is a trend for real estate agencies to take note of. Millennials are now old enough to afford major life purchases such as cars, homes, and boats, and that may change the face of the industry and its trends.
A home buyer has a lot to consider, but some basic factors include the location, whether the house is new or used, and the rooms and features inside. A family with kids, for example, will want to buy a house in a neighborhood close to a school and a public park. The number and types of rooms will make some houses more desirable than others, and the interior’s condition is a factor, too. A recently remodeled house will cost more, but it will look and feel great, and buyers may be drawn to them (along with competition). And a used home should certainly be visited and looked over for any maintenance issues before a purchase.