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Buying a home for anyone is one of the biggest investment decisions anyone can make. Generation Y which have high disposable income are also bundled with education loans, job insecurity, etc. They have to keep track of their expenses and savings if they want to purchase their dream home.
Generation Y are the ones who are born between 1980’s and 2000’s, so they are currently aged below 35 yrs. The generation grew up with the internet and believe in doing their own research for everything, whether its investments, travelling, etc. They sometimes overlook the need for a good agent, which can be essential for closing a transaction.
The current real estate market is riddled with uncertainty; due to excess inventory and delayed projects the prices of residential properties have crashed which makes it an ideal time to purchase a home. In the long term, real estate is always a good investment decision, as it gives good returns, due to land appreciation, as well as savings on rentals and tax breaks. While finalising a home it is important to weigh in all the factors and do complete research about the property you want to invest in. This is where a good real estate brokering firm comes in. The right firm will help you find the perfect home, based on your location preference, amenities required, as well as budget. You would also be able to find complete legal and financial details about the property, which is important before you make the biggest financial decision of your life.
Here are some important things that you should keep in mind before becoming a home owner:
1. Professional and trustworthy realtor
One of the most important steps in purchasing a home could be getting the right realtor. A trustworthy realtor could help you in finalising the perfect deal at the right price. They would be able to give you choices, based on your neighbourhood preference, location as well as budget. They have a wide network of resources, which can prove to be very useful to first time home buyers.
2. Finalising a budget
Since most Generation Y are riddled with education loans as well as a certain amount of job insecurity, it is ideal for them to know how much they can afford before starting their home search. First time home buyers should list their monthly income, savings, etc. before finalising a budget.
Also, an important thing to keep in mind is the actual cost for homes. Apart from the down payment amount, there are other expenses like closing costs which include homeowner’s insurance, inspection, etc. that can add 2% - 5% to your budget.
3. Start saving
You should start with a monthly saving plan, which would help you grow your savings for a rainy day. Even a small part of your salary each month can add to a big amount over a period of time. Also, as soon as you start searching for a home, you should also start saving towards the home loan EMI as that will help you get a better idea about your budget as well as what is the EMI amount you can comfortably pay each month.
4. A Pre-approval letter
Getting a pre-approval letter for banks can help you get a home loan easily as well as show to the seller that you are a serious buyer. A pre-approval letter could help you get an upper hand over buyers who haven’t taken this step. It would also help you close a deal quickly once you find your dream home.
Having a decent credit score can help you in getting a home loan quickly, at attractive rate of interest. However, a bad credit score may make it difficult for you to get a home loan. Good credit score is between 661 and 780, and an excellent credit score is between 781 and 850, though it may vary for different lenders. However, by having a good credit score you can get a pre-approval letter with ease.
While buying a home, it is important to keep researching for the perfect location. You should check out the infrastructure, roads, parks, schools in the nearby vicinity, shopping places, etc. as they can affect your location preference. It is one of the most important decisions to be made before buying a home.
Buying a home is one of the biggest investment decisions for Generation Y, so take your time. It is advisable to not rush into a deal; rather you should research, take your time, consult with your elders and mentors as well as get help of a professional realtor firm. By keeping these points in mind, you will be able to get the perfect deal for your dream home!
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