For Millenials, Gen z-ers, and beyond, the prospect of purchasing their first property is far scarier and seemingly unattainable than in previous generations. In the past, real estate was still a major purchase, but a typical household in which the father had a full-time job and the mother stayed at home had sufficient income to buy a home and raise a family.
In today’s reality, even with a dual income, couples are scraping by if able to buy a home at all. As a result, many of today’s young families are relegated to renting or squeezing into a condominium. The prospect of finding a real estate deal within their budget isn’t seriously entertained.
Unlike other industries, most people think there’s no such thing as a serious deal in real estate. But for those with good credit and solid employment that are just shy of affording a home, there is still hope!
Be diligent, follow these tips and if you’re patient, you will be able to finally make your dreams of homeownership come true.
1. For Sale By Owner
When homes are for sale by owner, you can get really lucky and find a listing that’s below market value because the seller accounts for savings on agents fees. Additionally, they are generally much more willing to negotiate, enabling you to explore terms with them to meet your budget. The trick is finding these real estate listings. The best way to be the first one with your foot in the door is by going to the big real estate websites, like Trulia and Zillow, and setting alerts for whenever a ‘for sale by owner’ property comes on the market in a desirable area.
2. Rehab Loan
A lot of young buyers could swing purchasing a home, but often what they can afford is undesirable. Understandably, they’d often prefer biding their time in a non-committal rental unit than buying an old run-down home they can’t afford to front the cash to renovate. Luckily there’s a type of loan you can apply for that allows you to incorporate renovation costs. This gives you the opportunity to hunt down great real estate bargains without having to worry about the quality of your home in the short term.
Banks focus on money management, not property management. For this reason, in the unfortunate scenarios when people’s homes get foreclosed on, banks are willing to give significant discounts just to unload the property. However, with foreclosures, they’re a mixed bag, there are a lot of run-down properties with issues the previous owners probably couldn’t afford to fix. Work with an experienced agent and make sure you have a thorough inspection conducted so you know exactly where you stand. As mentioned in number 2, rehab loans are a great way to make a foreclosed property a viable option.