Most millennials find homeownership more important than anything else. A study by the Bank of America shows that over 70% of them preferred owning a home, 50% favored getting married, and about 40% chose children. Most millennials consider homeownership as s sign of personal and financial success.
Those who don’t own a home so far mentioned the following reasons, such as insufficient money for down payment, not affording their preferred location, too expensive, bad credit, and huge student loan debts.
If you have the same aspirations and challenges, here is what you should deliberate on before buying a home.
Homeownership Decision
Over the years, most people have been made to believe that owning a home is a sign of success, and renting is something “less.” So you must decide whether owning a home is really what you want.
Keep in mind that homeownership usually comes with additional expenses, financial commitment, and devoted time for upkeep and maintenance. These factors can make it difficult for you to trade in places for a better job or any other situation. So don’t base your desires on what someone told you.
Retirement Savings
Retirement may appear like a lifetime away, but being frugal on your savings can really bite you when you hit 65, and it’s very easy to do so when you’re saving money for immediate purchases.
So set your retirement savings on autopilot to contribute enough. Since retirement contributions are usually deducted from your paycheck, you can then begin to budget and save for your dream home.
Don’t Overstretch
Though you may be excited about your dream home, don’t overstretch your income. Financial experts recommend not using more than 25% of your income on home expenses. That percentage also includes your taxes, mortgage payment, and home insurance.
Duration of stay
If you don’t intend to stay in a place for about 7 years, then renting a home is a smarter financial decision than purchasing. This is because the supplementary costs of purchasing and selling often exceed the appreciation value of the property unless you plan to stay a long time.
If after thinking through these factors you still want to buy your first home, then you need a few tips to help you negotiate.
Tips For First-Time Home Buyers
Like other first-time home buyers, you probably think that your realtor will do the dirty work for you, particularly during negotiations. And instead of being proactive, you may get busy finding the best removals in Blackpool.
While it may work, it is always wise to make sure that you seize the opportunities to bargain for what you really want. For instance, you can bargain on closing costs, extended move-in, or house repainting.
Most young buyers often assume their realtor will negotiate on their behalf. But keep in mind that the agent’s aim is to see the deal go through, and not always to get you the best deal. However, they will ask everything you request them to.
So once you find your dream home, here are four negotiation tips to deploy.
Research About The Offer And The Seller
Information is power. So gather as much information as possible about the home, the seller and the neighborhood. This information comes in handy when developing an offer that can suit you and the seller.
Some of the information you should try to find out include the asking price in comparison to the prices of other homes nearby, home’s duration in the market, previous offers and why they failed, reasons for sale and the time the sellers want to leave.
Be Ready To Make An Offer
After gathering all the information you need, make sure that you’re emotionally and financially prepared to negotiate. To get ready, have your financials in order, get a preapproved loan, know your budget limit and save down a down payment.
Most importantly, be ready to let the house go when the price exceeds your budget limit. Don’t let the seller notice how badly you want the house.
Make A Fair Offer
When negotiating, always present a fair offer. This doesn’t need to be the asking price, bit offer any price that can seem insulting to the homeowner. Base your offer on the information you gathered and home prices in the neighborhood. A rule of thumb is making a reasonable offer based and backed up with facts.
Give Room For Negotiations
When buying a home, a take it or leave it attitude can only do so much. It can easily create an air of hostility, so leave room for negotiations. Remember, most negotiations fall over tiny squabbles that often contribute to a fraction of the cost.
Buying a home is one of the best decisions you can make. However, make sure it is really what you want, get your pocket ready, and follow these negotiation tips.
