You’ve been saving for a house by paying down your debt, working on improving your credit score, and cutting back on spending to find extra cash for savings. For many of us, buying a home will be the single biggest financial milestone we hit. Owning a home can drastically improve your quality of life, and it can seem especially appealing now that many of us are working from home and expanding our families.
But now, the world as we know it has come to a halt. Does that mean all your hard work was for nothing? And how long will you have to put your dreams on hold? The Coronavirus pandemic is making a lot of dreams feel out of reach, but if you’re wondering if you should put your dream of buying a home on hold, here are some things to consider:
Low interest rates encourage home buying
The real estate market hasn’t taken the hit that some were expecting considering the last recession — in fact, homes are selling faster than ever. With interest rates teetering near historic lows, this could be an advantageous time to buy. Low rates mean owning a home is in reach for many, with dollars stretching further — not to mention savings in interest.
Expect increased competition and higher home prices
While real estate is still in hot demand for buyers, sellers are hesitant to put their homes on the market during a global pandemic — and that means competition. With demand now exceeding supply, the pandemic has resulted in an unexpected seller’s market. So while you could take advantage of low interest rates, you may be paying a premium for your dream home while fighting off the competition.
So far, we’re at a wash: One for the positive column of low interest rates, one for the negative column for the increase in competition and higher prices. So how do you know if buying now is the right financial move for you?
That final piece of the puzzle is your financial health, and what your overall financial portfolio looks like. You should be aware of your debt, have a plan to pay off your debt, and have even analyzed your spending habits. You’ve probably even made some adjustments along the way to make sure your financial future is as bright as possible.
So now, it’s really up to you and your personal priorities. It’s entirely possible that the best physical, emotional and financial decision for your family is to purchase a home now. But if you realize you have too much debt you still need to pay off or have other goals that would be set back if you buy a home now, you may want to wait. Buying a home is a big decision. Check out these tips on buying your first home.
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