Purchase of a home in Albuquerque can be intimidating for many young or first-time buyers. Homebuyers aged 25 to 40 may be unsure about the homebuying process and what they can afford, according to a recent survey. The study found:

  • “1 in 4 underestimated their buying potential by $150k or more”
  • “1 in 4 underestimated the increase in value by $100k or more”
  • “47% don’t know what a good interest rate is”

Most young homebuyers have given up on their search because they feel uncertain, or worse, they have decided homebuying isn't right for them and don't even start a search.

If you want to buy a home but aren't sure where to start, here are three things you should know about homeownership.

1. Down Payments

It's not necessary to have a large down payment to qualify to buy a home, but that's how many people view it. According to Freddie Mac:

“The most damaging down payment myth—since it stops the homebuying process before it can start—is the belief that 20% is necessary.”

Those looking to buy between July 2019 and June 2020 only had to make an average down payment of 12%, according to the National Association of Realtors (NAR) Generational Trends Report. The median down payment for buyers ages 22 to 30 was only 6% when controlling for age.

2. You May Be Able To Afford More Home Than You Think

Spending more time in our homes as a result of working from home, exercising, and spending more time on leisure has changed what people expect from their living spaces. Some young homebuyers are unable to afford homes that will meet their growing needs, so they choose to continue renting. As a result, they'll miss out on some of the benefits of home ownership in the long run. A recent NAR article points out:

“Many young adults are underestimating how much they need for homeownership, the survey finds. Millennials underestimated how much home they can afford right now, how much interest they would pay over a 30-year mortgage, and how much home values appreciate, on average, over 10 years…”

When you are starting the home buying process, knowing how much to spend on a home is critical and could be a game-changer.

3. Don't Wait

In addition, with mortgage rates on the rise along with home prices appreciating, you may end up paying much more for putting off buying a house now. According to Sam Khater, Chief Economist at Freddie Mac:

“As the economy progresses and inflation remains elevated, we expect that rates will continually rise in the second half of the year.”

Experts predict that interest rates will rise in the months ahead, and even a small increase can affect your purchasing power. There's no better time to buy a home if you've been on the fence.

When you begin your home search, you may feel overwhelmed. You're not alone. We can help. Contact the Sandi Pressley team today to see how you can make your goal of owning a home a reality.

Contact us today to help you buy or sell your next home in Albuquerque. Looking for the perfect home for sale in Albuquerque? Our easy-to-use home search tool can help you start the process. Join us twice a week on our blog for more real estate advice and great reasons to buy a home in Albuquerque and the surrounding area. Follow us on Facebook for the latest Albuquerque real estate updates.

 

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13516 Deer Trail Place NE, Albuquerque, NM 87111  $875,000

6 Bedrooms / 4 Bathrooms (3 full, 1 half) / 5893 Square Feet

Perfectly situated with 180 degree views in Glenwood Hills. The frosted glass accented front door greets you and beyond is a wide, open floorplan, with tons of natural light, gas fireplace and wet bar making this home perfect for entertaining. Main level boasts a master suite, 2 spacious bedrooms, formaldining and well-appointed kitchen with breakfast nook and access to one of many patios. Upstairs is another master suite with jetted tub and double sinks, privatebalcony and a fantastic walk-in closet. The garden level is open to the patios and is perfect for rec room/office/gym. Want city AND mountain views this uniqueproperty offers panoramic, breathtaking city views with Mount Taylor in the distance! Hiking, biking and walking trails are just minutes away.

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