Should I buy a house right now? Are you torn over the question of if now is the time to make a permanent commitment to Eugene and the surrounding Lane County area by purchasing a home in the community? After all, life in our part of the Pacific Northwest is life-affirming, and it’s natural that you’re tossing around the idea of establishing a permanent address in one of Eugene’s terrific neighborhoods.
Should I Buy a House Now?
This is a common question that we get. There are a few things to consider before you start the process, so we typically go over those. Here’s what to consider in order for you to make a good decision on applying, or waiting.
1: What’s the Balance in Your Bank Account?
There’s no getting around the fact that real estate in Lane County is pricey and you’ll need to seriously examine whether you have enough money to invest in a home right now. Some of the reasons that a healthy bank account is crucial to buying a home include:
Home Loan– Mortgage lenders want confidence that you can make your monthly loan payments, so they demand copies of your bank statements as evidence that you have the resources to afford the home loan. Keeping a robust balance in your savings account helps you to qualify for a home loan.
Down Payment Money– You’ll generally need somewhere between 3% and 20% of the total purchase price of a home as a down payment, depending on the loan and terms you are looking for. Although there are low down payment home loans available to eligible borrowers, you’ll have a more extensive variety of financing opportunities if you have enough cash on hand to put down. Expect to pay PMI on any home loan that doesn’t include a 20% downpayment.
Ownership expenses– Your money outlay for your home doesn’t stop when you write your monthly mortgage check. Additional costs include property tax, insurance, maintenance, and utilities.
2: Is Your Job Stable?
No one wants to imagine losing a job. However, the time to consider how you would continue to pay for a home if you found yourself temporarily unemployed is well before you begin searching for a house. It’s a smart idea to examine the job market for your field while also giving your budget a hard look before you buy a home. Experts say that you should strive for an emergency fund that contains enough money to cover at least three months of your living expenses.
3: Are There Any Significant Expenses in Your Future?
Are you thinking about going to graduate school or exploring a new career? Would you like to expand your family and have one parent stay home full-time for the first few years with your child? Will you need to help an elderly parent pay for a nursing home?
Think about how your life might change over the next five years or so before committing to a home mortgage. Make sure that your budget has the room to support any looming significant expenses when you’re deciding if now is the time to finance a new home.
4: What’s Your Credit History?
Your credit score is vitally important in obtaining a home loan as a lender won’t often approve a loan application if you have a subpar credit history. Your credit score is an indicator of your overall financial fitness at a given moment in time. Along with home loan approval, you’ll reap lower interest rates when you bring a healthy credit score into the mortgage process.
Fortunately, since your credit score is always in flux, you have an excellent chance to improve it if the number is a little on the low side. Some steps that you can take to make a positive impact on your credit score include:
- Paying down your credit card balances.
- Pay off smaller loans.
- Make your payments on time.
- Read your credit report for mistakes.
- Did you know that credit reports are rife with errors that can unfairly lower your overall credit score?
- You can avoid unfair dings on your credit by ordering a free credit report.
5: Should I Buy a House Now, in Lane County?
Housing markets are cyclical. Sometimes it’s a seller’s market with soaring prices and multiple offers on homes. Other times, buyers get the advantage of lower asking prices and an abundance of houses to consider. What’s more, there are also those times when both sellers and buyers are nearly equal. The key to deciding if you want to jump into the market is whether you can deal with the fierce competition of a sizzling seller’s market or not.
We all agree that Eugene is a fantastic place to live and our housing prices over the last few years are great. The hot demand over the previous few years has driven home prices up in Lane County. However, as The Register-Guard notes, the housing market started cooling off in late 2018, decreasing the asking prices for homes.
Lane County enjoys a healthy economy that makes investing in a home here a terrific long-term investment.
Contact Us Today
Lastly, investing in a home is one of the best ways to tie yourself to the neighborhood that you love. Knowing the right time for you to purchase a home is the key to happy homeownership. Indeed, the answer to the question of “should I buy a house now?” is an individual one that depends on your circumstances and desires.
We’re here to help you locate an outstanding home loan when you decide that the time is right to buy a home. Contact us at Strategic Mortgage Solutions for assistance with all of your home lending needs.