Are you thinking about making a move this year? Whether it is buying your first home, upgrading or downsizing, Virginians are entering 2020 with a positive outlook on the real estate market. According to a recent real estate report by Roanoke College, almost 40 percent more respondents are positive about markets today compared to the previous year.
This positive outlook can be contributed to rising income, wealth and job security, which boost consumer sentiment and encourage spending. Low mortgage rates have also encouraged households to participate in the housing market despite high prices, and 25 percent of respondents are positive about markets over the next few years. However, home buyers are less optimistic than home sellers due to rising housing prices and low inventory across the Commonwealth.
Trying to prepare or decide when and how you should make a move? Here are some tips and recommendations on navigating high prices and what preparation plans you need to have in place before buying or selling your home.
- Start Doing Research: This includes both researching house listings and following the market trends in the area you are looking to buy a house. Researching a typical home loan should also be included in this first step and utilizing your mortgage banker from the beginning can make the process much easier.
- Create a Housing Budget: Establishing a budget is the first step in the home buying process. Setting a budget of how much you can pay toward your mortgage each month may seem daunting, but it just requires you to look at how much you make each month versus expenses you have to pay. Do not forget to set aside a separate budget for other costs including down payments, closing costs, renovations and other unexpected expenses.
- Check Your Credit Report and FICO Score: Most lenders qualify your loan based on your credit score. Start by discovering if you have a healthy credit score and make sure the information in your credit report is accurate. If you see anything on your credit report that doesn’t look right, start the process of correcting the error or have it removed as soon as possible. Consider using Annualcreditreport.com as it provides a free copy of your credit report once every 12 months. More importantly, they provide records from each of the three nationwide consumer credit reporting agencies: Equifax, Experian and TransUnion.
- Get Pre-qualified vs. Pre-approved: If you are pre-qualified then that simply means you may qualify for a certain dollar amount, but you still need to get pre-approved. Pre-approval goes a step further and means the lender has determined that you meet its requirements, and then you can decide if you want to submit an application. Make sure you talk to your lender and learn all the details of what its pre-approval means. Some banks mean different things when they say “pre-approved.” At Atlantic Union Bank, our pre-approval means we have fully reviewed your file including your income and assets. Then all you need to do is go out and find your new dream home.