What Boston condo first-time buyers need to know
“The first half of 2021 has seen the fastest growth in rent prices since the start of our estimates in 2017. Our national rent index has increased by 11.4 percent since January . . . .”
Those rising rental costs may make it seem impossible to prepare for homeownership if you’re a renter. But the truth is, there are ways you can – and should – prepare to purchase your first home. Here’s some expert advice on what to do if you’re ready to learn more about how to escape rising rents.
Start Saving – Even Small Amounts – Now
Experts agree, setting aside what you can – even smaller amounts of money – into a dedicated savings account is a great starting point when it comes to saving for a down payment. As Cindy Zuniga-Sanchez, Founder of Zero-Based Budget Coaching LLC, says:
“I recommend saving for a home in a ‘sinking fund’ . . . . This is a savings account separate from your emergency fund that you use to save for a short or mid-term expense.”
Zuniga-Sanchez adds saving in smaller increments can help make a large goal – such as saving for a down payment –achievable:
“Breaking up your goals into smaller bite-sized pieces by saving incrementally can make a large daunting number more manageable.”
Assess Your Finances and Work on Your Credit
Another tip experts recommend: take a look at your overall finances and credit score and find ways to reduce your debt. According to the HUD, the average credit score of first-time homebuyers is 716. If you’re not sure what your credit score is, there are numerous online tools that can help you check. If your score is below that average, don’t fret. Remember that an average means there are homeowners with credit scores both above and below that threshold.
If you find out your score is below the average, there are several ways to improve your credit before you apply for a loan. HUD recommends reducing your debt as much as you can, paying your bills on time, and using your credit card responsibly.
Start the Conversation with Your Advisor Today
Finally, it’s important to talk to someone who understands the market and what it takes to become a first-time homebuyer. That’s where we come in. A trusted advisor can help you navigate your specific market and talk you through all the available options. Having the right network of real estate and lending professionals in your corner can help you plan for the homebuying process as well as determine what you can afford and how you can get pre-approved when you’re ready.
Most importantly, we can help you understand how homeownership is achievable. As Lauren Bringle, Accredited Financial Advisor with Self Financial, says:
“Don’t write home ownership off just because you have a low income . . . . With the right tools, resources and assistance, you could still achieve your dream.”
Boston Condos and the Bottom Line
If you’re planning to be a homeowner one day, the best thing you can do is start preparing now. Even if you don’t think you’ll purchase for a few years, let’s connect today to discuss the process and to set you up for success on your journey to homeownership.
The Boston condo for sale market has been increasingly difficult for first-time home buyers. We already know how competitive the market is for finding Boston condos for sale under $500,000, and the weather has not chilled the market enough to make it any easier for first-time homebuyers to purchase in Boston. Stories about home bidding wars and prices going up 10% above the listing price are something we have read or heard about already. Everyone is ranting about the Boston condo marker being too expensive to live and buy a home now.
What Can first-time buyers do?
For first-time home buyers, this is terrible news. Most first-time homebuyers cannot afford Beacon Hill homes over $500,000 or anywhere in downtown Boston Their usual range is $300-400K for a condominium won’t get you too close to Downtown Boston. But if you can’t afford to live in those parts of Boston, would you rather rent and miss out on your homeownership? Homes are out there if you can just adjust your expectation a little and move slightly further or even outside of the City of Boston. Yes, that means you might need to drive a car or take the bus or subway.
There is hope
There is still hope for first-time home buyers. After all, these news media covering horror stories about Boston condo for sale prices fail to address what actually constitutes “Boston” in their story and why surrounding cities aren’t included in these stories such as Arlington. Quincy Chelsea. East Boston and more. Although home values throughout downtown Boston have gone up quite a bit in the last three years or so, one can still buy a nice home in a safe neighborhood at a decent price. What about neighborhoods like Arlington? Arlington is only 15 minutes from the Redline to Beacon Hill. It’s important to realize what you can and cannot afford and adjust your expectations accordingly. After all, most people commute to work from the suburb unless living in a small condo is your thing. It won’t be a social suicide to move out of desirable parts of Boston. Do some driving around different neighborhoods and talk to a realtor to learn more about where safe neighborhoods are.
If you are a first-time homebuyer who wants to battle in the Boston Midtown market in your budget range, you will definitely need to work with a good real estate buyer’s agent. Please give me a call or text at 617-721-9504 to see if I can help.