Buying your first home is both exciting as well as a bit daunting. After all, it’s not like buying your first car on your own. Besides the obvious difference in price, a car can readily be sold should someone get buyer’s remorse. A home on the other hand, isn’t something you can decide to sell soon after you bought it. There's a lot more to it. First, selling a home can be somewhat expensive if you look solely at the closing costs, commissions, taxes and so on. I mean, you can certainly sell the home, it’s just that there’s so much more involved.
And perhaps the market isn’t just right. While home prices have been on the rise for a couple of years and mortgage rates have hit highs not seen in a couple of decades or so. In addition, if you’re waiting on rates to come down, it might be a while. Yes, the Fed has sat on its hands the past couple of meetings but even if the Fed did start lowering rates, it only makes adjustments in increments of 0.25% in most instances. So if you’re waiting for rates to get back down in the low 6.00% range, you’ll likely be waiting a while.
On the other hand, owning is so much better than renting. There are certainly some tax advantages plus you’re gradually gaining wealth over time. When you rent, you own nothing. You’re just handing over your hard earned money to your landlord.
All that said, you’ll never hear a real estate agent tell you it’s not a good time to buy. At least I’ve never heard that. Agents make money when homeowners sell and buy homes. Telling you to do neither isn’t very favorable to their pocketbooks or their careers. They’re right though, it is better to own and to rent. But maybe you just aren’t ready.
It’s normal to feel a little apprehension when getting a preapproval from your mortgage company and making an offer on a home. It’s easy from this chair to tell you to ignore that apprehension but it’s going to be natural. After all, you’re making a rather long term commitment. As mentioned, if you get some buyer’s remorse, you can’t exactly take the home back to the market with your receipt and ask for a refund.
Don’t rush into anything. Take some time. Get comfortable with the process. But only make the move when you decide so, not when others make the suggestion. Remember, you’re the boss here.
