First time buyer

[A. Berk Gokce]

Hi all! Ive been wanting to buy my first place. Currently living and working in NYC but looking to move to Jersey City or the Hoboken area. 

I currently have 30K as my down payment for around 300k apartments. I have a few questions for experienced buyers.

Is this a good time to buy? 

What are your advices when it comes to mortgages? I have an 800 credit score and 75K income. 

Should I look into NYC or NJ for my first home? 

[Kenny Smith]

@A. Berk Gokce

Great question!  So I can't speak specifically about your market, but I can give you an idea of what is happening in a general scale nationally right now.

First off, interest rates.  We have seen rates continue to increase, with rates hitting a 23 year high last week at a national average of 7.49% for a 30 year fixed mortgage.  With that, buyer's affordability is taking a hit.  We've seen the luxury home market take a hit, and has been pushing buyers into the entry level home market more and more.  Whatever your entry level  home price is, there is likely going to be even more competition for those homes.

With that being said, prices have kept going up or stabilizing because we are dealing with such low inventory.  This is not good for both buyers and sellers.  Buyers in the fact their monthly mortgage will go up tremendously, but also sellers for those who want to trade up, don't want to because they become a buyer in this market.  Also, if they bought or refinanced during COVID, they likely have a very low rate they don't want to give up.  For those reasons, sellers are holding onto their homes until rates go below a certain percent.  Who knows what that number is, maybe between 5-6%?  

With all that said, now is a great time to buy.  Think about it like this, if you are on the sideline waiting for rates to drop, so is everyone else.  There is insane pent up demand right now, and when rates drop, everyone is going to get back into the market, and home prices will sky rocket again.  Especially with inventory going to continue to be a problem in the coming years.

If the rates keep going up, it is actually a good thing for investors and buyers.  This will scare a lot of buyers out of the market and they will wait to buy.  Those that are savvy can get it, negotiate a lower price on a home (especially in the offseason), and refinance the mortgage/rate if and when rates drop.

You can also negotiate into an offer what is called a temporary rate buy down paid by the seller.  That can help alleviate short term interest rates buying you time until they drop and you refinance permanently. 

I would recommend reaching out to a Realtor in your area to help guide you through this process.  If you don't have a Realtor in mind, I have a very large brokerage and would be happy to refer you to someone out there.  I'll shoot you a DM.

I hope this helps!