Ask any real estate agent if now is a good time to buy a home. Chances are good you’ll probably get the impression that it’s the perfect time to buy a house.
Makes sense, right? Most agents wouldn’t want to discourage anyone from buying a house.
However, it’s almost impossible to truly say that now is the perfect time for someone to buy a house without knowing a lot more about them and their entire situation. It depends upon their personal wants, needs, and qualifications. It depends upon the real estate market overall. It depends upon mortgage rates. And it depends specifically upon the price range and areas they’d be looking in.
There are a lot of variables, so you can’t truly ever say that “now” is a good time to buy, let alone the best time for someone to buy a home…
...unless they are first-time home buyers.
For first-time home buyers, “now” is always the best time to buy a house. But “now” is in quotes for a reason...
It doesn’t get any easier
Once you already own a house, there’s a lot more to think through and deal with when buying a new home.
Most people can’t buy another house without selling the one they already own, unless of course they’ve got enough money to buy one without having to sell their other one first. Most people can’t handle two mortgage payments, though, or even qualify for a mortgage without selling the one they already own.
Even if you’re buying your first home, the market, mortgage rates, and your personal situation all should be analyzed and taken into consideration. But, regardless of any of that, “now” is always the best time to buy since you don’t have to worry about selling the one you already own. There’s simply a lot less to worry about or take into consideration.
You have competitive advantages
When you find the home you love and want to buy, there’s always a chance that someone else in the market will love and want to buy it as well. So, the more advantages you have as a buyer, the better off you’ll be if you’re competing for a seller’s attention.
When you don’t have a house to sell in order to be able to buy a home, you’re in a better position than some of your competition, because:
- You can be flexible on the closing date, so the owner can either have more time if they need it, or you can close more quickly if that is better for them.
- Your purchase won’t be “contingent” upon the sale or closing of a house you already own. There’s no chance that the sale of your home will fall through, causing you to have to cancel the deal. That’s always a concern agents and owners have when someone makes an offer and has a house they need to sell.
It also allows you to be more patient and wait until you find the right house. People who already own a house sometimes have to settle for one they don’t love, simply due to having to buy a place in order to time their purchase with the sale of the house they already own.
At the same time, you can pounce and make an offer the minute you do find a house you love. Others have to wait and watch the house of their dreams slip away.
Having these, and other advantages in your favor, also makes “now” always the best time to buy a house for a first-time buyer.
Don’t make mountains out of molehills
Many first-time buyers are concerned about timing the purchase of their first home with the ending of their lease on a rental.
It certainly doesn’t make sense to buy a house if you have an entire year left on your lease, and there’s no clause for you to get out of your lease without paying the remaining balance to the landlord. But, that’s rarely the case.
First, most renters have provisions in their lease that allow them to break their lease — with little or no financial penalty. Read your lease carefully and see what you are personally bound to, and what you are allowed to do. But many would-be first-time buyers tie themselves down for too long, simply because they’re unaware of how easy and / or low-cost it would have been for them to break their lease.
Second, you don’t just run out, find a house, and close on your dream home in a couple of days. It usually takes time to find the home you want, and then go through the entire process all the way to closing. So, let’s say that takes 3-4 months on average for the whole process. Most renters don’t even have that much lease left to worry about once they find a house to buy.
So, if you’re currently renting, don’t worry so much about your lease. Definitely make sure you know your rights and what you need to do. Doing this will make you a stronger buyer than most of your competition who rent. There’s a good chance they’ll hesitate and force themselves into timing issues they could’ve avoided if they were more diligent.
Pro tip: If your lease comes up for renewal, or you’re signing a new one, and you know you want to buy your first home, negotiate with your landlord to have a month-to-month lease or to be able to give a couple months notice and be released if you buy a house.
Buy Like It’s Not Your First Time
Buying a house can be tough even for someone who has already bought a house before, not just first-time home buyers. After all, most people don’t buy houses more than a few times, so it’s not something most people spend much time learning the ins and outs about.
And that’s a mistake…
The more you know about buying a home, the better off you’ll be:
- Your purchase will go more smoothly.
- You won’t make rookie mistakes even veteran home buyers make.
- You’ll increase the chances that you’ll find the best home for your wants and needs, and successfully buy it. (Many people lose the house they really wanted by making simple mistakes, and end up settling for another one later on.)
- You’ll have a better chance at getting the house you love at the best price possible.