Truths Young Homebuyers Need To Know  

For many young or first-time homebuyers, purchasing a home can feel intimidating. It doesn’t have to be. If you’re interested in buying but aren’t sure where to begin, here are three key concepts about homeownership you should understand before you get started.

You don’t have to put 20% down.

Saving for a down payment is one of the biggest obstacles for first-time homebuyers, but that doesn’t have to be the case. “So many people think you need to put 20% down, but that simply isn’t true,” says Michelle Korosy, Sales Associate at ERA Justin Realty. “Having more cash to put down helps in a tight market, but younger buyers often put down less. The ‘20% down payment’ is a myth.” According to the National Association of Realtors (NAR) the median down payment for homes purchased between July 2019 and July 2020 was only 12%. And that’s the overall average for all ages. When narrowed down to only buyers between ages 22 and 30, the percentage was only 6% down.

You may be able to afford more than you think.

“Some young homebuyers think they can’t afford a home that has everything they want, so they continue renting instead,” says Jennifer Darby Metzger, Broker/Owner of ERA Justin Realty. This mindset could mean missing out on the long-term benefits of owning a home. “They often underestimate how much home values can appreciate,” adds Darby Metzger, “They get back their mortgage payments and more when they sell. By renting they’re essentially just paying someone else’s mortgage.”

Homeownership Will Cost More the Longer You Wait

Finally, with mortgage rates starting to rise along with home prices, putting off buying a home now could cost you much more later. “The higher the rate, the bigger your monthly payment,” says Korosy. “If you’re on the fence about buying, there’s no better time than the present.”

If you want to buy but feel overwhelmed, you’re not alone. Call Michelle Korosy or any of the sales agents at ERA Justin at (201) 939-7500 to talk more about the process, what you’ll need to start your search, and what to expect.