Is 2023 a good time to buy? Here’s some advice from exclusive buyer’s agents! Whether the risks of the current market outweigh the benefits depends on your situation. An exclusive buyer’s agent is in the best position to give you buyer-centered advice, as opposed to what will help sellers. Like our company, exclusive buyer’s agents from NAEBA spend 100% of their working life thinking about how a market affects buyers. They are agents in companies who only work for buyers. Enjoy the following guest post!

A guest post from the National Association of Exclusive Buyer’s Agents

A First Time Home Buyer’s Guide in Recession

Becoming a homeowner for the first time is a big step. Buying a new home is also a large financial commitment. So it’s understandable that when home prices drop and mortgage payments and interest rates alike are lower than usual, renters begin to think about the real estate market and wonder “Is it finally time to buy and stop overpaying for rent?”

The answer is “It depends!” Before you buy a house, you should assess all the factors that weigh into the decision, such as:

  • The climate of both the real estate market and the overall economy
  • Your financial situation and long-term job stability
  • Your income vs. home affordability
  • Any first time home buyer programs for which you may be eligible

Let’s dive a little deeper into how you can assess whether it’s a good time to buy or not! Here are some tips to keep in mind.

Do Your Research & Ask Questions

Buying a home always involves some level of risk vs. reward.

It’s difficult if not impossible to time the market. You can buy your home during what you think is a leveling-off period of prices and then later realize that it was more of a low peak.

Conversely, you could (and many people do) buy houses during a true dip, when prices are extremely low, and sell them later on, making tens or even hundreds of thousands of dollars.

So what do you do? You research everything you can to make the most informed decision possible. But part of that involves knowing where to begin and WHAT QUESTIONS TO ASK.

You’ll want to have a firm grasp of things like:

  • How much home can you afford?
  • How do mortgages work?
  • Do you want a condo, a single-family home, an apartment, or a multi-family home?
  • What are the prices of local real estate and how have they changed over time?
  • Will you be buying alone, with a partner, or “house-hacking” with friends or family?

Buying a house during a recession can pose more risk than buying a home during more stable financial times. But the upside can also be much bigger, making it a fantastic investment, so long as you know what to expect.

Signing with a seasoned buying agent can paint you a clearer picture of where you truly stand when it comes to home buying readiness and point you in the right direction. Plus, THEY’RE CONTRACTUALLY COMMITTED TO WORKING IN YOUR BEST INTEREST so you know all the facts before making a decision.

Get a Handle on Your Finances & Job Security

You’ll want to work with a lender or lenders to see what you can really afford when it comes to your first home. It may be less (or much more!) than you think.

Just remember: during periods of economic downturn, layoffs aren’t uncommon. So think carefully about the security of your role. If you get a great price on a home but can’t afford to make payments, you could face foreclosure and bankruptcy.

That said, if you’re thinking about home ownership, you likely already are well aware of these risks. For someone like you, buying a home during a recession could be the best financial decision of your life! It certainly can’t hurt for you to talk through your options with a realtor or buyer’s agent.

When Is the Best Time to Buy a Home?

SEASONALITY CAN AFFECT HOME PRICES AND INVENTORY. Of course, so can the housing market, which is sensitive to economic downturns.

But the bottom line, as Melissa Cohn, a regional VP at William Raveis Mortgage notes, “…WHEN YOU FIND THE RIGHT HOUSE AT THE RIGHT PRICE, IT’S ALWAYS A GOOD TIME TO BUY.”

What’s more, during a recession, HOMES WILL LIKELY BE CHEAPER. There also may be less competition and you could lock in an extremely low fixed interest rate. In other words: you could get a killer deal.

Find a Buyer’s Agent with naeba.org Today!

Interested in joining the ranks of working professionals who are benefitting from a fixed-rate mortgage payment – and saying goodbye to annual rent hikes? FIND AN EXCLUSIVE BUYER’S AGENT THROUGH NAEBA.ORG NOW!