There are many home-buying myths swirling around in the real estate market.
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Today we’re busting five myths about buying a home in 2021:
1. You must have 20% down. While yes, it’s beneficial to have a 20% down payment, you can purchase a house via a conventional loan with as little as 3% down, via an FHA loan with as little as 3.5% down, or via a VA loan with as little as 0% down.
2. You need a perfect credit score. In truth, you can purchase a property with a credit score as low as 580, though it’s better if you have a score over 620. For the most ideal pricing and interest rates, it’s best to have over 720.
It’s a wonderful time to buy a move-in ready house.
3. Now is not the best time to buy. Prices have indeed been increasing, but interest rates are at historic lows. If you’re waiting for the next recession or the real estate market to decline, you’re playing an unlucky game of chance. Out of the last five U.S. recessions, the real estate market only depreciated in two of them; in the other three, the market continued to appreciate.
4. You should buy at the top of your pre-approval. That may or may not be true for your specific circumstances. It all depends on what you want to spend monthly on housing. That’s the most crucial thing to consider when deciding how much to spend on a new home.
5. It’s cheaper to buy a fixer-upper. This is not always true, especially with the current competitive prices we’re seeing for labor and materials in construction. With our low interest rates, it’s a wonderful time to buy a move-in ready house that doesn’t need so much work.
If you have further questions about these myths or any other real estate matter, feel free to contact us via phone or email. We would love to help you.
Let BLG be your trusted agent and advisor for buying, selling or investing in Conejo Valley real estate.