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New Year, New Home

We’re sharing four tips on how to make a new home in 2020 a reality for you. 

Buying a new home is a very common New Year’s Resolution, especially among prospective first-time buyers. There are a lot of things you can do right now at the start of the new year to prepare yourself for this life-changing purchase.

One of the things we always tell people is to make sure you don’t overspend during or right after the holidays; the more debt you bring with you into the home buying process, the harder it will be for you to qualify for a loan.

If you bought a lot of holiday gifts out there, hopefully you didn’t throw them all onto credit cards. All the “no interest financing” rhetoric from furniture and car salespeople around the holidays is great, but those big purchases will still count against your debt-to-income ratio. 

Start looking at what the market has to offer now instead of waiting until later. 

If buying a home this year is truly a priority for you, avoid other big-ticket items like cars and expensive furniture sets until after you buy a home. Even if you don’t have payments on those items for six months, they’ll still be factored against you by mortgage lenders.

Here’s another tip: Get your financials and taxes in order so you can take advantage of deductibles and ensure you’ll still qualify for loans.

Start talking to a real estate agent now; they’ll be able to help you find a great home in a location you like—all in a timely manner. If you and an agent create a plan early, you’ll be able to jump on the new inventory that’s coming in spring.

To all those who are already qualified for a home loan: Start looking at what the market has to offer now instead of waiting until later. Don’t wait just for waiting’s sake; maybe you’ll find something great and get that resolution taken care of early in 2020.

 If you have any questions about this or any other real estate topic, or you’re thinking of buying or selling a home soon, don’t hesitate to reach out to me. I’d be happy to help you.

What You Should Consider Before Buying a Second/Vacation Home

Thinking about buying a second home or vacation home? Here are a few key points to consider.

Before you decide to purchase that second home to use yourself or to rent out as a vacation property, there are a few critically important things you need to consider:

First and foremost, you need to define whether the home is a second home or a vacation home. For example, if you’re renting it out, you may not be able to use it when you want to. You also have to follow certain rules and restrictions, and a lot of associations don’t let you rent out second homes.

Whether yours counts as a second home is less about the money and more about your lifestyle. Whether it counts as a vacation home depends primarily on its cash flow—what kind of money can it legally make in its area?

It’s an investment to either make more money or to enjoy yourself, but not both.

Purchasing a second or vacation home is different from other home purchases from the very beginning: It’s an investment to either make more money or to enjoy yourself, but not both. If you don’t define it as either an investment or personal purchase, it can cost you. Why? There are different tax implications regarding second homes and vacation homes. It’s also a good idea to familiarize yourself with the HOA and/or county rules and regulations in the area you’re purchasing the property in. For example, the Tampa Bay area is very restrictive when it comes to things like Airbnb rentals. Don’t hesitate to call the HOA beforehand to ask if having a rental like an Airbnb is allowed. Finally, be sure that you’re up for the commitment. Having an Airbnb or rental property can become its own job and requires a considerable amount of your time. It might sound cool to tell people that you have a vacation rental, but in reality, it can be a drain on your time and resources, and it might be cheaper for someone to just get a hotel room and save their money. If you have any questions about buying second homes, vacation rentals, or about purchasing property at all, feel free to reach out to us. We’d love to help you.

Should You Buy a Home Now or Wait Until Later?

Should you buy a home now or wait until later? Here are some homebuying tips based on the current market.

We can’t tell you how many people have made the mistake of waiting for just six months to buy a home, which then turns into a year, which turns into two years, and so on. That’s years of money wasted on giving away rent, tax opportunities, and equity gains to someone else. Here in Tampa Bay, we fully expect homes to continue to appreciate—waiting doesn’t make sense.

Some of the first clients that Robert ever spoke to back in 2010 were personal friends of his. They had just been waiting for the market to get a little cheaper, expecting to eventually find the perfect deal. It’s 2019, and they’re still waiting. There are people who are paid tens of millions of dollars to time the market, and even they mess it up—it’s impossible to accurately time the real estate market.

We can say that the Tampa Bay real estate market is very healthy. You may hear rumblings of a recession coming up, but with employment as strong as it is and interest rates as low as they are, this points to a really solid economy here. We’re really fortunate that interest rates have stayed low for as long as they have because they can’t keep dropping forever.

Waiting until later to buy a home will likely cost you more due to increases in prices, interest rates, and appreciation.

Prices here keep rising; that $250,000 home you’ve been eyeing may be worth 10% more by next year. Waiting until later to buy a home will likely cost you more due to increases in prices, interest rates, and appreciation. The reality is that a lot of people try to make financial decisions with their personal lives in mind. Why spend years living in an apartment that you don’t really want to live in forever, spending way too much money each month on things like Starbucks? Don’t wait for the opportunity to become a homeowner to fall into your lap, because by waiting, you could price yourself out of the market. If you take the time to speak to a professional mortgage lender or Realtor, you’d be surprised at how cheap it can be to actually own a home as opposed to renting one. And if you end up selling in two or three years after the market appreciates, you’ve already made some money. There are some good reasons to wait if you truly do need to: waiting for an upcoming bonus, dealing with credit issues, or seeking employment might be good reasons not to buy now. However, believing that you can accurately time the market and will fare better than the experts is not a good reason to wait. If you have any questions about buying a home or the market in general, reach out to the Duncan Duo. We’d love to help you with all your real estate needs.