Is this the year you want to buy a home?
Why buy a home? What’s the real reason home ownership is such a dream of so many people like you?
I have personally seen how it impacts people's lives. I’ve seen young military families make $200,000 in 5 years on their home, I’ve seen growing families get the ability to move up to their dream home after buying their first home. I’ve seen people get married, create memories, fall in love all in their homes.
What most people think is they cannot afford to buy a home.
How do you figure out if you can afford a house. This is a long and short answer. In San Diego, typically people spend about 50% of their income on housing. I know that may sound crazy, but it’s the sunshine tax we pay to live in this amazing place. Let’s start with this budget worksheet, which you can download for free in the description.
Now, here’s the unknowns. First, your age. Statistically most people will make the most money in the 40’s and 50’s. So if you are young you may think about stretching a little more to buy a house that will appreciate more knowing you are not in your highest income earning age yet. If you are heading into retirement, then you may want to think about downsizing which I will cover in another video.
Tips to afford a house.
Ok, the big one. You do not need 20% down. There are benefits to this of course like no PMI (private mortgage insurance) BUT if it’s between buying a house and getting into the market vs not, buy the house then refinance later when you have more equity. If we look at any 10 year period in california housing you will see that home prices increase. Now, if you are going to buy a house and only have it for 2 years, then renting may be a better choice.
Another way to afford a house is to get a gift from a loved one. Many people receive gifts for down payments and closing costs. Speaking of closing costs, since the market has shifted we can now start ask the sellers to credit us for the closing costs OR to help with interest rates.
What if you don’t have the best Debt to income ratio? Then you can get a co-signer. The co-signer does NOT have to give you any money and you can refinance them out after 6 months. It can greatly help you with getting a better rate.
Finally there are programs such as the down payment assistance program, which is specific to how much you make, and calfha which allows you to borrow for your down payment. If you want more information on those please reach out to me directly so I can walk you through that.
Really you have to think about the pros and cons of owning a house. If owning a home costs you a few hundred dollars more a month, but you are building equity, is that worth it to you? What is your long term plan for your life? Let’s talk anytime about that, please call or text me so I can help you start planning for your future.
While I am a realtor in San Diego I can help you find an amazing realtor anywhere in the country! Thank you for watching and please subscribe to be alerted to more in this how to buy a house series
Let's Talk about Your Real Estate Dreams!
760-310-0166 | tristen@homebytristen.com
