Buying A Home During An Economic Downturn: Things To Know
You have saved up money to cover closing costs and down payments, you have worked on getting your credit score where it needs to be, and you feel like you are perfectly ready to start shopping for your own home. Unfortunately, a major change in the economy brings about a downturn and you have a few fears about buying a house. Even though it can be a bit scary to buy a home when financial markets are looking grim, there are a few things to keep in mind that may help guide you along the way.
Keep your own financial outlook in mind more than anything
Even if the economy is changing for the worse, what you really have to consider is how this will affect you personally. For example, will your job be affected by a drastic change in the stock market? Will this mean you have fewer hours at work, or fewer clients if you own a business? If you have a fairly stable income in spite of the economic downturn, you may be fine to proceed with your plans to buy a home. You should consider two important things:
1. If your income could potentially change so much that you won't be able to afford a payment
2. If the house you have in mind to buy will retain its value if you have to sell in the future
Keep your home prospect ideas in line with what will be in demand
You do not want to invest in a home that will quickly lose its value in the middle of an economic downturn. Even though the real estate market can take a while to be affected during these situations, certain types of homes can see their values affected more than others. For example, a luxury home with a lot of amenities may be a bit less desirable, but a modest, single-family home is more likely to retain its value. Single-family homes may be more likely to retain value for many reasons, including the following:
- These are the most popular home styles
- These homes typically don't have a lot of unnecessary amenities
- These homes are designed to be efficient
As you look at prospects, do your best to steer your desires toward a home that will still be desirable for the coming years.
Work with a Single-Family Home Real Estate Agent for Guidance
Even though a real estate agent's job is to sell homes, it is also their job to help buyers make conscientious decisions about the homes they buy, even in special circumstances. Reach out to a real estate professional who specializes in single-family homes for expert advice.