We all know by now that the market we are currently facing is a buyers market. Simply put this just means that there are more houses on the market than people willing to buy them. With such a high inventory people are being forced to sell their homes for record low prices. I think that not only is the market great for all buyers, but specifically for first time home buyers.
With Banks being one of the major reasons we are in such a real estate slump they are being very conservative about who they give loans to. A lender is much less likely to give a loan to someone who had trouble with a previous home loan, for this reason, being a first timer makes it much easier. You still need to have fairly good credit, but credit card dings are much easier to clean up than a home loan.
Another reason being a first time home buyer is beneficial is that you have realistic expectations about home pricing. You probably weren’t looking at the inflated prices of houses in 2007, so you can be confident that your home will increase in value during the time you live in the home. Speaking of time, current market trends in Portland are still declining, albeit slowly, so you want to plan on living in the home for at least 3 years to get some return on your investment. Now back to the benefits of being in the market.
The biggest benefit of being a buyer in the market is the concessions you can ask for, because most people NEED to get rid of their homes, you can ask for a lot of help at closing without risking your offer being rejected. By law you can’t ask for more than 3% of the purchase price to go towards closing costs, but most people are accepting these terms. On top of that you can ask for help paying for the inspection and the appraisal, traditionally the buyer would be alone on these costs but sellers are more and more willing to split them. In many cases you can have all but your down payment paid for. This makes the cost of buying a home much smaller.
Being a first time home buyer also has some risks, you don’t know market lingo, and probably haven’t spent the time researching all of your options. Any of these risks can be erased almost completely by working with a Realtor who knows the market. Feel free to call me with any questions you may have, and happy buying!