First-Time Millennial Home-Buyer?
Updated: Aug 16, 2018
Millennials might be happy to know that their generation according to the National Association of REALTORS® is the largest share of home buyers at 36 percent. So, if you are a Millennial and living with your parents, there is plenty of hope still. When you are ready to move out, consider investing in a property rather than renting.
Here are a couple of practical advice to consider:
Save, do the math and stick to your budget
It’s important to pay off your debts, student loans and any outstanding IOUs; a good credit score will ensure for a lower mortgage rate. It can be hard to get started on savings however if you stick to your goals and trim down on spending you will definately be on your way. Make sure to do your calculations, lending institutions follow the 28/36 rule, which means that your mortgage payment, property taxes and insurance should not take up any more than 28% of your monthly gross income. Finally add that to your total debt payments, which should not total more than 36% of your gross income.
Make sure you have enough for a down payment, it is important to put down as much as you can, it will determine the duration of your mortgage as well as your monthly rate. Don’t overlook taxes, property insurance and closing costs. There can be hidden costs that can surprise you if you do not budget for it. Ultimately on your part you will need a stable job, commitment and some sacrifice.
2. Explore the neighbourhood, shop around and have the property inspected
Prevent unnecessary surprises by doing your homework. There’s nothing more upsetting than buying a “lemon of a house”. To avoid major household issue that can pop up over time, hire a qualified professional to inspect the property. Your health and safety is worth the extra expense you will pay up front. The inspector should look into the structural and mechanical aspects of the property, safety and security concerns and identify potential hazards such as asbestos, lead-based paint or mold.
Are you ready? Let’s talk investment. Contact me at anytime.