First time home buyer advice

[Nicholas Bagliani]

First time buyer here, looking for advice.

Like most first time buyers currently, I’m heavily questioning buying if now is the right time to buy. 

I am 29, single, employed, have ample savings, a full VA loan, and am pre approved for 550k, and looking within an hour of the dc metro area, ideally Harford county MD due to the good schools and military bases near by.

I personally hear from tons of people who think the market will come down, due to the struggling middle class and the fact that it will get worse. I agree with that. 

However.. My concern.. if these big corporations are buying up a majority of houses, assuming there’s no legislation in place to stop them from doing so or sell them off, now IS the time to buy before they take everything from us over time.. it DOES seem like now or never.

Regardless of recession and lay offs in the future, these big corporations will just buy more, they’ll never run out of money. and we will all have NOTHING.

Anyone else agree/disagree?

[Kevin Sobilo]

@Nicholas Bagliani, at ANY given point in time people can come up with several reasons why it isn't a good time to buy. Looking back with hindsight you won't see that because hindsight is 20/20 but its true.

A few comments on the points you made specifically:

1. "The market will come down". Keep in mind the market for you is where you are looking to buy. All real estate is local! Prices might go WAY WAY up even when national averages are going down or vice versa. Local markets are impacted more strongly by local factors than national ones such as changes in interest rates.

2. Big corporations buying properties isn't even a thing in many markets. Even if they are in your market, that should not change whether you should or can buy. A house that makes an idea rental is often different than ones that makes the ideal forever home. Yes, in some markets big companies buying properties can have a noticeable affect, but it isn't likely to be forever or as pervasive as you think at this moment.

Also, companies buying investments want to make money. They aren't just buying to buy and lose money. So, it isn't that they will buy up everything. They do have limits.

It sounds like you want to buy a primary residence. Does it have to be a "smoking deal"?!? It doesn't! If you plan to stay there a long time 10+ years then likely the value will be the same or likely greater even if prices soften in between. Think of it this way, if you stayed in the home 30 years and paid it off, it would be a good deal for you no matter the final value. You are buying the house for your own use more than for an investment.

If you plan to be there LESS than 7 years, then I might consider NOT BUYING because if prices stay the same it will take nearly that long to pay down a mortgage enough to cover commissions and closing costs to sell and break even. 

[Jacopo Iasiello]

Hi Nicholas, The DC metro area, including Harford County, MD, has seen strong demand and limited inventory, which can drive prices up. It's essential to assess whether current prices align with your budget and long-term goals.

[Russell Brazil]

Quote from @Nicholas Bagliani:

First time buyer here, looking for advice.

Like most first time buyers currently, I’m heavily questioning buying if now is the right time to buy. 

I am 29, single, employed, have ample savings, a full VA loan, and am pre approved for 550k, and looking within an hour of the dc metro area, ideally Harford county MD due to the good schools and military bases near by.

I personally hear from tons of people who think the market will come down, due to the struggling middle class and the fact that it will get worse. I agree with that. 

However.. My concern.. if these big corporations are buying up a majority of houses, assuming there’s no legislation in place to stop them from doing so or sell them off, now IS the time to buy before they take everything from us over time.. it DOES seem like now or never.

Regardless of recession and lay offs in the future, these big corporations will just buy more, they’ll never run out of money. and we will all have NOTHING.

Anyone else agree/disagree?

 Harford is more than an hour from DC. Do you need to commute to DC?

[Jack Seiden]

Quote from @Nicholas Bagliani:

First time buyer here, looking for advice.

Like most first time buyers currently, I’m heavily questioning buying if now is the right time to buy. 

I am 29, single, employed, have ample savings, a full VA loan, and am pre approved for 550k, and looking within an hour of the dc metro area, ideally Harford county MD due to the good schools and military bases near by.

I personally hear from tons of people who think the market will come down, due to the struggling middle class and the fact that it will get worse. I agree with that. 

However.. My concern.. if these big corporations are buying up a majority of houses, assuming there’s no legislation in place to stop them from doing so or sell them off, now IS the time to buy before they take everything from us over time.. it DOES seem like now or never.

Regardless of recession and lay offs in the future, these big corporations will just buy more, they’ll never run out of money. and we will all have NOTHING.

Anyone else agree/disagree?

1st of all corporations own less than 2% of single family homes, they have actually reduced thier share of buying recently, now investors continue to buy up properties, it’s just more mom & pop types, all that said the housing market is in an extremely strange place, I could make strong arguments for prices pulling back, reaccelarting, or being basically flat, the biggest thing I’d advise is looking at you payment, comparing that to what would pay in rent, figuring out how long you plan to be the house and making an decision based on that, generally in that under 400k price point, breakeven for buying a property seems to about 3-5 years if you plan to stay in the house longer than that, bite the bullet & buy, if not rent. 

[Benjamin Aaker]

Since you are buying your first home, the price is probably not as important to you as the location, floorplan, etc. Look at your personal budget and determine the house price that you can reasonably pay. This is much more important than timing the market. If you are ready to own your first home, then now is the time. It is unlikely that prices will take a sharp dive that is sharp enough to wait for. 

[Manny Vasquez]

The single most important piece of advice that I received in regards to Real Estate is the following: 

"Timing the market is not what matters, rather, TIME IN the market is!"  

I can tell you one thing....EVERY BP member wishes they would have bought properties sooner or much earlier than they did.  EVERY single person.  

In every market and in every economic period, you will always have people stating that NOW is not a good time to buy.  They will come up with over a thousand reasons as to why that is.  Maybe for them, NOW may not be a good time, however, for you it may be. 

If you are ready (and it very well seems like you are), then its just a matter of figuring out what type of property you want to acquire and where.  i wish you the best and Good luck!

[Marcus Auerbach]

Quote from @Nicholas Bagliani:

First time buyer here, looking for advice.

Like most first time buyers currently, I’m heavily questioning buying if now is the right time to buy. 

I am 29, single, employed, have ample savings, a full VA loan, and am pre approved for 550k, and looking within an hour of the dc metro area, ideally Harford county MD due to the good schools and military bases near by.

I personally hear from tons of people who think the market will come down, due to the struggling middle class and the fact that it will get worse. I agree with that. 

However.. My concern.. if these big corporations are buying up a majority of houses, assuming there’s no legislation in place to stop them from doing so or sell them off, now IS the time to buy before they take everything from us over time.. it DOES seem like now or never.

Regardless of recession and lay offs in the future, these big corporations will just buy more, they’ll never run out of money. and we will all have NOTHING.

Anyone else agree/disagre

Fear based online content get's the most clicks. Like the market will crash soon. Look up real estate value charts over the last 50 years and see how many crashes you find.

Most first time home buyers have rented for a decade or more, that's usually 100-200k that's just gone. If you buy a house and the market is soft in 3 years, just don't sell it. That's what everyone else does, that's why home prices are called downward sticky.

Even if you would have bought a house in 2007, which was by far the worst year to buy a house in US history and we are not going to see this in our life time again, by 2015 you would have been whole again. But meanwhile your loan principal got paid down, you had tax write offs and maybe even did some remodeling.

Would you have been better off renting from 2007 to 2015?

Don't watch the click bait, go buy a house. 

[Joe Norman]

I'm local to Harford County and actively involved in this market. I can tell you that we have extremely low inventory and a limited appetite from our local government to construction significantly more. This is going to keep prices up regardless of the Federal Interest Rate moving a point or two. Those waiting for a recession will be waiting for a LONG time...it isn't happening this economic cycle, the stubbornly high inflation rates indicate that.

A few points above to reiterate: (1) real estate is LOCAL, while there may be some worrying trends nationally, the Harford County market is strong and will stay that way IMO, (2) timing the market is generally a fools errand if you have a long term outlook (if you're looking at short term investments then timing factors in more), (3) if you're looking for a place to live (not strictly an investment) then there are a lot of other important factors to consider.

Bottom line is that if you have the means, and if you intend to own the place for 5 or more years, I personally wouldn't hesitate to jump in. PM me with where in Harford you're looking to live and I can provide some more local advice. 

Good luck!
 

[Nicholas Bagliani]

First off, I want to thank everyone who has commented on my forum post. Great information from seemingly great real estate pros. Thanks again to all. 

Is anyone aware of lenders currently offer the VA one time close construction loan? Also approved builders in Maryland for that loan? Lenders/builders that are able to do log homes would be even better.

Im currently looking into buying land in cash around the harford county area if I can get lucky enough to use the VA one time construction loan.

If im going to pay 4-500k for a 30 year old home, i might as well spend around the same if not less to build my own smaller home the way i want it..

Any info or advice is greatly appreciated. 

[Nathan Williams]

Nicholas,

So much to unpack here! Call me. I used my VA loan twice and gearing up to use again. I live in the Virginia Beach area, but I'd be happy to chat about the market and the construction loan options that are available (lots of challenges with these) and of course a mortgage broker is who you ultimately want to talk to about loan options based on your goals!

[Asif Kabani]

Congratulations on taking the first steps towards homeownership! It's a big decision, and it's smart to consider all angles before diving in.

You're right to weigh the current market conditions and potential future trends. The concerns about large corporations buying up housing stock are valid and reflect broader market dynamics. However, your situation—having a full VA loan, ample savings, and a pre-approval in a competitive range—puts you in a strong position to navigate these challenges.

Given your circumstances and goals, buying a home could indeed be a way to build equity for yourself rather than paying rent that contributes to someone else's mortgage. It's also worth noting that Harford County, with its proximity to military bases and good schools, could be a stable long-term investment, as areas with these features often maintain their value well.

It's essential to stay informed and possibly consult with a real estate professional who understands the local market dynamics of the DC metro area. They can provide insights into the pace of sales, pricing trends, and how much competition you might face from institutional buyers.

Ultimately, the decision to buy a home should align with your personal and financial goals. If you're planning to stay in the area for several years, and the numbers make sense, purchasing a home could be a prudent decision despite broader economic uncertainties. Remember, every market cycle has opportunities and challenges, and personal circumstances often dictate the best course of action more than market timing can.

Good luck with your decision, and don't hesitate to reach out to the community here for more insights or support as you move forward with your home buying journey!

[Brad Ainslie]

Nicholas,

Congrats on thinking about buying your first home.   I have no real insight to your market but let me share my personal perspective.   

I started my search in 2006/2007.    Things felt very similar to how they are now.   Prices were high and even houses that needed complete demolition seemed outrageously priced.    

2008.  Prices started coming down in 2008.  I found a house that needed some work but was what I thought a real bargain.  $50k lower than most homes I’d been looking at previously.    At the time I thought surely prices can’t drop much further.   I won’t share all details but long story short I got the house.   

2009-10 prices ccontinued to fall, houses in my neighborhood were selling under $100k and I was seriously underwater in my mortgage.   

Today I have a ton of equity in the house.  As others have said.  Set a budget, determine what you can afford (not what a mortgage broker says you can afford).

Do your best to figure out insurance and taxes, and try to set aside 5% for maintenance each month for big ticket repairs that WILL happen.   

Best of luck in your search!

[JC Coskun]

Quote from @Nicholas Bagliani:

First off, I want to thank everyone who has commented on my forum post. Great information from seemingly great real estate pros. Thanks again to all. 

Is anyone aware of lenders currently offer the VA one time close construction loan? Also approved builders in Maryland for that loan? Lenders/builders that are able to do log homes would be even better.

Im currently looking into buying land in cash around the harford county area if I can get lucky enough to use the VA one time construction loan.

If im going to pay 4-500k for a 30 year old home, i might as well spend around the same if not less to build my own smaller home the way i want it..

Any info or advice is greatly appreciated. 

Hi Nicholas, I can give you some advice. I build from ground up or do heavy rehabs in the DMV area. I do have a good VA lender which I can share which might be of value for you. Feel free to DM me.