Buying a house is one of the best accomplishments you could ever achieve in your adult life. You’re probably one of the many young professionals looking to buy their first home. The idea of shopping around for a house or looking for the best lending organisation out there can be exhilarating, but you should first ask yourself the question, “is now the right time to buy a home?” Considering the state of the economy right now due to the pandemic, you’re not the first person to think about this. If you want to know if you’re ready or not to own a home, you better ask yourself these questions first.
Can I Afford to Buy a Home Right Now?
With prices of houses booming in many parts of the country, properties are being sold for well over the asking price. In some cases, up to hundreds of thousands over. First-time homebuyers are forced to dramatically increase their budgets or even reconsider the type of home they’re buying. In this day and age, you need to be sure that you can afford to buy a home right now. Are you prepared to increase your budget to afford the home you’ve always wanted?
Am I Ready for Potentially Higher Mortgage Repayments?
Another inevitable result of rising house prices is the bigger mortgages and interest rates. While right now, interest rates are still manageable, they will inevitably begin rising again. Just because you can afford a mortgage at an interest rate of 2-3%, will you still be able to afford repayments if the interest rate were to double? Not only that, you may have trouble being approved for a loan. This is because lenders factor in your ability to repay the loan at a higher interest rate when calculating your ability to repay the loan.
Will I Buy or Sell First?
If you’re not a first-time homebuyer and you already have a house of your own, a different question may have crossed your mind. The question of buying or selling first has plagued the minds of many homeowners, especially if the state of the market becomes too unpredictable. There’s the dilemma of some sellers being caught out by the rapidly booming property market and are debating whether to sell first and take advantage of strong demand and rising prices. On the other hand, there’s also the option of buying first then selling out of fear that they may not be able to buy back into the market.
Have I Considered All the Risks of Buying?
There’s never a guarantee that you’ll make money on the sale of your home, but when you buy in a rising market, you’re at an increased risk of overpaying for a property. This falls in value when the market inevitably goes back down. That’s just one of the many risks of buying a home right now, and it all depends on where you’re located and what your market’s performance is right now.
Conclusion
Buying a home has always had its risks. While investing in a new home isn’t a bad thing, you have to consider many things first, just like the ones listed here. Hopefully, this helps you figure out if you’re ready to buy a house or if you should wait a couple of months or maybe another year to do so
Wealthy You is currently Sydney’s best mortgage broker any homebuyer can partner with. We’ve been serving the community of Sydney for almost a decade through our hassle-free lending and refinancing options. If you’re looking for alternative mortgage funding, you may just find what you’re looking for from us. Find the best loan for you by contacting us today!
