It is the Americans’ dream to own a house after marriage. It is a sign of financial stability, a steady job, and one of the essential milestones in someone’s achievement.
There is a lot of pressure for a married couple to achieve this goal. For example, the expectation coming from their friends and family. Or the targets that they set for themselves.
Are you planning to buy a house anytime soon? Perhaps you have visited different communities and are thinking that you have found “the one”. But creating a rushed decision to buy a house is risky. They might not expect unwanted spending and end up having a wide margin of miscalculation. The consequences of failing to expect the unexpected will lead someone to face a financial crisis. Thus, deciding when you are ready to buy a new house is essential.
Learn how to decide the perfect timing to buy a new house.
Do You Have Spending Issues?
Take a look at your financial burden. Do you have the debts to pay? It is common for someone to have debts to pay, but what you have to consider is the scale of your debts.
According to the ratio standard that’s generally used by the Federal Housing Administration (FHA), you should have a 43% debt-to-income (DTI) for mortgage approval. It is not only for the new house but also for your whole debt. If your total debt is more than 43% of your income, you have to wait for a better time to buy a new house.
Have You Decided on the Duration of Your Stay?
Buying a house is a commitment. Unlike renting, you cannot move to other places as you please. You have to settle how many years you are going to spend there. If it is less than five years, you have to reconsider your plan to buy a house.
You will pay capital gains taxes if you sell your home less than two years after buying. That is why you have to consider how long you are going to stay in your house. If it is less than five years, consider renting a house. Buy a house when you’re sure that you will settle in there for more than five years.
Observe the Housing Market
After considering the spending issues and finding out the duration of your stay, it is time for you to observe the housing market. You have to know when is the high season of the market and when is the low season.
If your concern is the housing price and your possibility to bargain, buying a house in the low season will suit you. The lack of competition with the other buyers will be beneficial. You can get the best price if you buy the house near winter or a few days after Christmas.
Near winter, the homeowners will try to get their property sold as soon as possible. It is to avoid the extra maintenance they should give to the house in winter. And the same goes for the other houses. You have to observe how the location of your targeted property impacting the housing price in each season.
That is not applicable if you are not concerned about the price. If you want to have better options and financially ready to compete with the other buyers, then the high season of the housing market is the perfect choice for you.
Just like the flowers, ‘For Sale’ signs are blooming in Spring. It is because most of the families are waiting for the school holidays to move in with their kids. A lot of housing options are available this season until the first week of summer. With the competitive price and ideal time to move into a new house, it can be the perfect time for you to buy a home.
How is The Economy?
The season is not the only cause of the changing property price. The economic crisis and the world’s market are also impacting the cost of your targeted property.
The expert predicts the housing price will rise another 5.7 percent compared to the price in 2020. It will happen if the mortgage rate is still low and followed by high demand. People’s economy is recovering. The economic downfall can drag the housing prices lower. It happened once in 2006, because of the global financial crisis.
If you are still considering buying a new house, you have to know the timing. Make sure you can cover the mortgage rate and won’t be risking your financial stability. Most of the house buyers forget to consider the maintenance of a new house. Sometimes, it costs a lot more than the monthly mortgage payment. Therefore, be picky of the timing.