Wednesday, 14 November 2018
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This Old House - Do-it-Yourself

Is Now The Right Time to Buy Your First House

Written by Posted On Thursday, 22 March 2018 11:23

Should I Buy My First Home?

If you are considering buying your first home, chances are you have asked yourself some variation of this question: “Is now the right time to buy?” You are not alone in your uncertainty. All types of buyers, from first-time home buyers to serious investors, are always faced with the same question. The market is impossible to fully predict, and there are times where the market is more favorable to buyers than others.

Ultimately, the answer to your question is a personal one. What is right for you will not be the same as what is right for another buyer. But there are some points you can consider, points that lead to the conclusion that, yes, now is still a good time to buy. Over my thirty one plus years as one of the top real estate agents in Framingham Mass, interest rates have not been more attractive. All indications, however, is that the current interest rate environment is about to change.

In fact interest rates have started to creep up just a bit. Most analysts are predicting that money is going to slowly but surely become more expensive. If you have been on the fence about buying your first home now may be a great time to lock in an attractive interest rate.

Why Buying Now Is A Good Idea

1. Buying is still cheaper than renting in most situations.

Mortgage rates are still low enough to offer considerable savings for buyers over renters. As a buyer who puts down a reasonable down payment, you can wind up saving a great deal of money over the long-term. Interest rates would have to climb substantially for renting to result in a cost savings in most markets.

Of course, sometimes saving money is not the only concern. If you are not sure if you are going to be living in the same city for a period of years, renting may make more sense. Don't ever buy a home just for the sake of purchasing one. That could be a financial mistake that could come back to haunt you.

2. Your rent can go up – a lot!

Real estate and rental rates are always unique to specific locations, which means you may be in an area with really stable, low rental rates where you still feel like you are saving money. But the reality of rents is that they can go up substantially, just on the whim of a landlord. You can go to renew your lease and discover that the landlord has boosted the rent too far more than you can pay, or to a point where you are now suffering financially.

Such rent hikes do happen, particularly in hot rental markets. Even if you are an ideal tenant the landlord may feel like he or she can just plug in another just like you. One of the coolest things about buying a property is when you discover five years from your purchase that you happen to be in a hot rental market now.

This also happens and can happen unexpectedly. It is not guaranteed by any means, but as an owner, you gain considerable financial advantages under the same circumstances as a landlord does when rent rates go up. If the market in your area improves, you are in a great position.

3. Buying is better in almost every market.

The benefits of buying can be obvious in smaller towns and cities where real estate prices are more affordable. For many potential buyers living in hotter markets, it can seem pointless to try and buy a property, if you can even afford one. What is the point, when everything is so expensive?

In truth, even in some of the hottest, most expensive markets in the country, you can still see financial benefits from buying instead of renting. Even in San Francisco, buyers save some money from buying versus renting.

You may have to expand your search area for a home you can afford, or look to something that is a compromise, like a townhome, but if you are going to be in your area for an extended period of time – like five years or more – buying can still make sense financially. Just make sure you look for the right things in your first home! Remember not to focus in on just the house but where you are choosing to live as well.

For example does the town or city offer everything you are looking for? Do you want a neighborhood feel, a country road or will a busy street be acceptable. These are all things you should think about before jumping into the market.

4. In most situations, you will build equity under the right conditions.

Most home buyers who pay their mortgage on time and get quality mortgages with reasonable rates will tend to build equity over time. There are situations where people lose money – like if they buy during a bubble, or choose a really bad mortgage – but such situations are not common.

Generally, as long as you keep making your house payments and take care of your home, in ten or twenty years you will have a nice amount of equity built up, which you can tap into later if you need it. When you pay rent, you are giving your money to your landlord, who will build his or her own equity.

5. Taxes cater to homeowners.

The interest you pay on your home mortgage – which will account for the majority of your payments for the first several years at least – is tax deductible. This is one of the major tax advantages of owning a home. Such deductions can result in real savings come tax time. Recently, tax laws have changed and the mortgage interest deduction has been reduced to an extent. It is, however, still there.

You can also deduct things like property taxes, private mortgage insurance (PMI) and mortgage points if you choose to buy them. There are even tax advantages for when you sell your main home. As long as you meet the requirements – including living in your home for two years out of the last five – you can keep the money you make when you sell the home in many instances. This is part of the real estate capital gains tax law. Many first-time home buyers are able to sell their homes for a profit eventually, and put that money into a better home with no tax penalties. These are all great reasons why now is a good time to buy your first home and start building equity!

Additional Helpful First Time Home Buyer Resources

Use these additional resources to make sound decisions when buying a home for the first time. There is so much to know as a first-time home buyer. Make sure you do all you can to educate yourself on the home buying process. These expert articles will be a big help.

About the author: Bill Gassett is a nationally recognized Real Estate leader who has been helping people buy and sell Metrowest Massachusetts real estate for the past thirty one plus years. He has been one of the top RE/MAX Realtors in New England for the past decade. In 2017 he was the #6 RE/MAX real estate agent in New England. Bill covers real estate in the following Massachusetts communities: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton and Uxbridge MA. Connect with him on

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Bill Gassett

One of the top RE/MAX agents in New England over the last decade plus. Providing exceptional real estate services to buyers and sellers in the Metrowest Massachusetts area including the following communities: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton and Uxbridge MA.

See my real estate website at Maximum Real Estate Exposure - one of the most visited real estate sites in Massachusetts.

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