Planning To Buy Your First Home In 2017?

By Martha D. Lopez-Elkind

Renegade Realty

. http://marthaelkind.point2agent.com/

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Planning To Buy Your First Home In 2017?

If your new year's resolution is to buy your first home in 2017, then you've got your financial work cut out for you. It goes without saying that a brand-new real estate investment will be one of the biggest commitments in your investment portfolio. And of all your investments, it will certainly require the most effort to maintain. Nonetheless, the return on investment from quality real estate can make all the trouble of aggressive saving, negotiating, and endless inspections worthwhile.

To further explain things you need to consider when buying a home in the current financial climate, Whitney Fite, president and founding member of Atlanta-based Angel Oak Home Loans, was able to share some of his insights. For anyone who will be spending the first few months of 2017 shopping for a new home, here are a few things you need to know before you start.

Mortgage Rates Have Risen Since the Election

According to Fite, “Rates have risen approximately .50% since the election, which is a rapid rise.The overall housing market remains strong, however, a Trump presidency could be inflationary which would cause real estate prices to increase.New applications on purchases have risen, which seems to indicate the prospects of higher interest rates and prices is creating a sense of urgency among buyers.”

There Is a Rising Trend of Single People Purchasing Homes

Buying property is a fairly common step in a financial plan, but the more”traditional” route is that it comes after joining your finances with a partner. Turns out, that so-called norm is becoming more and more dated. According to Fite, the average age of a first-time homebuyer is 33. However, he also says, “There is an uptick in singles purchasing homes, whereas in the past, most homebuyers were married.”

If You're Looking Into Investment Properties, the Cities Are Still (Most Likely) the Place To Buy

On choosing a location, Fite says it all dependson what you're looking for in a home. However, for those looking specifically for investment properties, price appreciation is perhaps the biggest consideration. Fite ultimately says that price appreciation is likely to be larger in metro areas, and continues, “For investors, it's all about anticipated cash flows they can get in a particular area. Rent increases have been much stronger in metro areas versus rural.”

You Need To Be Able To Afford More Than Just a Down Payment

Fite says, “For first-time buyers, it is imperative that they research the total costs associated with obtaining a particular loan amount, as this will be additional cash due at closing on top of the down payment.A mortgage provider can provide a verbal estimate in the form of a total percentage of the loan for example, in a particular area closing costs could be 2.5% on a $300,000 loan amount, which is $7,500.

Article written by Maya Kachroo-Levine, Forbes Contributor, and reprinted with permission.