Helpful steps to go from an occupant to homeowner
Let us talk about these steps and how helpful they can be!
Younger Americans, many of whom have strong jobs and good wages, are understandably feeling that the odds are against them when it comes to home ownership. The average age of a U.S. homeowner is 46, which is an increase of 21.3% since 2001. Or that the typical down payment for a middle-class home in the United States will increase to $63,000 in 2022 from $52,800 in 2021.
Also, the current economic climate for home ownership is one of, if not the worst, in American history.
AXIA Partners Brandon Fugal said; “Gone are the days when a young couple can purchase their first home with an entry-level salary, and even further gone are the days when a one-income household could purchase a home.” “Affordability is the primary reason younger people are struggling to buy a home, even though a large percentage of them would like to do so. Home prices have risen astronomically in the United States while the average wage has remained stagnant.” He then added.
Renter to owner transition
Younger prospective homeowners must overcome a steep learning curve before purchasing a new home, but it is not impossible. Use these strategies when buying a home to move forward with home ownership as quickly as possible.
Be aware of the “monetary realities” associated with purchasing a property nowadays. Saving for a home involves much more money than you would realize.
Top Dollar blog founder Josh Dudick said; “You aren’t just saving up for a new home deposit, you’re saving up for an emergency fund, any repairs that need to be done, bills and utilities, taxes, and other big expenses.”
“Whether this is little changes like going out to eat less, shopping at a different grocery store, or big changes like cycling to work each day, or not buying Christmas presents this year, you need a reality check when approaching home ownership,” He then added.
Adopt an investor’s mindset. Millennials and first-time homeowners can break into the real estate market by adopting a Wall Street investment mentality.
According to PunchList USA CEO Min Alexander; “Buyers need to shift their thinking when it comes to jumping into a “forever home” purchase that checks all twenty must-have boxes of their list.”
“By investing in more low-maintenance properties such as condos or smaller, short-term properties, first-time homebuyers not only can safely enter the booming real estate market sooner, while also avoiding the money-pits and costly work most dream homes require,” Alexander added to his statement.
Put a focus on affordability. There are numerous ways to increase a person’s capacity to purchase a new home.
According to Better Mortgage head of real estate Nick Taylor; “Focus on saving more money for your home down payment to offset the cost of your mortgage and monthly fee. Also, taking advantage of newer mortgage products like 10-year adjustable-rate mortgages that lower your interest rate for a 10-year period, which allows you to increase your sale price.”
Additionally, think about buying houses with lower cost-per-square-foot that can be renovated to have a greater home value (often fixer-uppers).
“Think about having a live-in tenant to offset your monthly mortgage or considering fractional ownership with you and a relative or investor,” Taylor added to his statement.