Tips for First Time Homebuyers

A recent article by My Northwest describes 5 things buyers do that can cause agents distress and strain the client/realtor relationship:

1. Try and see beyond the current look of the home. As the article describes, "real estate professionals say they wish more clients could get past the aesthetics of the house, especially since so many of the items that bother them are easily fixable."
2. Focus on more than just finances. Sure, it's important to be prepared to purchase, but it is also key to remember that "it's not necessarily the highest offer that the seller will accept, but rather the best structured offer combining timing, price and reasonable contingencies." That is why it is key to have an agent who is on your side and can allow you to make informed decisions regarding all aspects of the transaction.
3. In this fast-paced real estate market, timing can be everything and you won't always have a substantial amount of time to commit to a decision. "If too much time passes between a buyer viewing a home and making an offer, the seller might not take another party who quickly expressed interest and maintained communication."
4. Do not talk to the listing agent without your realtor by your side. As the article says, "the listing agent is there to get the most money for the seller, not save the buyer money," which is why you need your own advocate throughout the process.
5. When making a counter offer, don't "lowball" - going back and forth can be a frustrating process for agents and more often than not, is counterproductive as it offends the seller(s).

Realtor.com Addresses Millennials Who Can't Afford Homeownership Yet

In a recent letter to millennials, Jonathan Smoke of Realtor.com describes the biggest obstacles preventing millennials from homeownership. He nailed down four factors that are giving millennials the most cause for concern:

• Student Loan Debt - This can cause problems when trying to secure a mortgage, because "in order to get a qualified mortgage, you need a DTI of no more than 43%, so a very large student loan balance could disqualify you right off the bat."
• Credit Score - Given that history is one of the largest factors in determining credit scores, caution is necessary because "the average FICO score for a millennial with a mortgage this year is 714" whereas the average score of an American is 695.
• Down Payment - While having that 20% down payment is ideal, "the average millennial this year could only put 7% down." Smoke suggests aiming for a 10% down payment and saving as much as possible.
• Rents Are Rising - Many millennials are concerned with rents that keep rising faster than incomes:  "the majority of renters in the U.S. now have to spend more than 30% of their income to rent a typical home, and that means they're starting to sacrifice spending in other areas such as food and health care."