The current pandemic has everyone on edge. Buying a home is one of the best decisions you can make to help protect yourself and your family. During a pandemic, it’s essential to have a safe place to stay. A home provides that safe haven . It’s also a great place to store supplies and food in an emergency.
If you don’t have a home, now is the time to buy one. But many Americans are struggling to find one. Here are the most common reasons Americans struggle to buy a home and what you can do to avoid it.
Housing Shortage
The housing shortage has been happening for quite some time now. The country currently lacks over five million homes for sale. The rise in home prices and the decrease in inventory has made buying a home unaffordable for many people.
The good news is that the government is aware of this problem. They’ve been working on increasing the number of homes being built. However, this takes time. In the meantime, you can try to find a home within your budget.
You can also look for a less expensive area to live in. This might mean moving to a different state or city. But it could be worth it if it means you can finally buy a home. Additionally, you can choose to rent instead. Renting is an excellent temporary option if you want more affordable government homes to be built.
High Home Prices
Home prices have been rising for years now. The average price of a home is now over $400,000. Unfortunately, this is out of reach for many Americans.
There are a few things you can do to combat high home prices. The first option is to get a good mortgage. Visit your local mortgage company and see what they have on offer. There’s a good chance that you can negotiate a fair price. The second option is to look for a less expensive home. Some states sell cheaper homes, and you might get lucky and find a good one for your family. Lastly, you can always buy a fixer-upper. These kinds of houses are often much cheaper than new homes. But they do require some work to get them into tip-top shape.
Student Loan Debt
Student loan debt is one of the biggest obstacles preventing Americans from buying a home. The average graduate has over $37,000 in student loan debt. This makes it challenging to save for a down payment.
If you’re struggling with student loan debt, you can do a few things. First, you can look into refinancing your loans. It could lower your monthly payments and help you save for a down payment faster.
You can also try to find a job that offers student loan repayment assistance. Some employers will help you pay off your loans if you agree to work for them for some time. This could be an excellent way to get out of debt and buy a home sooner.
Credit Score
Your credit score is another important factor in buying a home. A good credit score shows lenders that you’re a responsible borrower. It can also help you get a lower interest rate on your mortgage.
If your credit score is low, you can do a few things to improve it. You can start by paying all your bills on time. It will show lenders that you’re responsible for your money. You can also try to get a credit card and use it responsibly. It will help improve your credit score over time.
You can also look into getting a cosigner. A cosigner is someone who agrees to sign your mortgage with you. They’re essentially taking on the responsibility of the loan with you. This can be a good option if you have bad credit but can’t afford to buy a home on your own. Lastly, you can choose to get a government-based loan instead. FHA loans don’t require an excellent credit score to buy a home.
Saving for a Down Payment
The final obstacle preventing Americans from buying a home is saving for a down payment. The average down payment is now 20%. You need to save $70,000 to buy a $350,000 home.
You can do a few things to save for a down payment. The first is to start saving early. You can also try to get a higher-paying job. This will give you more money to put towards a down payment. Additionally, you can look into government programs that offer assistance with down payments. Some of these programs are available for first-time homebuyers or low-income people.
Buying a home is a big decision. There are many factors to consider before you make your purchase. However, these obstacles preventing Americans from buying homes shouldn’t stop you from achieving your dream. With some careful planning and saving, you can make it happen.
