While the primary concern about the coronavirus pandemic is how we can keep our families and ourselves safe, the economic disruption caused by the disease cannot be ignored. Even those who haven’t yet been affected prefer to tread cautiously because they can’t predict what might happen in the future. If you are undecided regarding your intentions on buying a home at this time, taking a hard look at important factors that can impact your ultimate decision may be helpful.
Job Stability and Financial Situation
Buying a new home is a significant financial investment, possibly the largest one you will make in your lifetime. This makes it very important to evaluate the stability of your job. If you have been forced to go on leave or have had to take a large pay cut, buying a new home at this juncture may not be a wise decision. However, if you have special skills where there is a sustained demand, your employment is stable, you are financially independent, or you have adequate savings, then you can go ahead with your purchase. However, if you have even the slightest doubt that making the mortgage payments might be tough in the future, it is better to postpone the purchase until you are more confident, states Gary Saitowitz. Remember that a new home is not only about the mortgage commitments; you will generally be spending more on your energy bills or your commute as well as general upkeep of the property.
Lower Interest Rates Offset by Stricter Mortgage Criteria, Observes Gary Saitowitz
According to https://edition.cnn.com, the 30-year fixed rate of interest on a home loan has dipped to a record low of 2.88%. Many lenders are also being very conservative and have started to specify stricter qualifying criteria to protect themselves from default. As a result, obtaining a mortgage is proving to be more difficult than before, especially if you have a sub-prime credit score or are unable to make the full down payment.
Selling Off Your Existing Property
If you are selling off your existing home so that you can upgrade, the current pandemic situation may have affected the property market in your area. Finding out if you can still get a decent selling price for your house is important. While you may be financially secure, prospective buyers could have been severely impacted by the pandemic, possibly bringing down the demand for real estate.
Even if you are set in your decision to buy a new property, you still need to realize you’re no longer able to physically visit as many properties as you would like or meet sellers and real estate agents in the same way as before due to social distancing norms. Since most interactions with real estate agents as well as the inspection of the new property will have to be done online, you need to ensure that you are confident enough to make a good decision working remotely.