Many first-time homebuyers are experiencing much frustration. Despite several offers, they only end up being outbid. Intense competition, a low number of houses on sale, and high prices make everything more challenging for many aspiring homeowners. First-time homebuyers also tend to be younger. Their credit history is not deep enough, resulting in lower credit scores.
Even before the pandemic, finding a home and moving cross country has always been a difficult task. First-time homebuyers keep losing their opportunities to older bidders. They tend to have less time to save enough for an emergency fund and a good deposit. These circumstances put first-time homebuyers at a disadvantage, especially in today’s market. Presently, a home is considered affordable if it is three times one’s income.
Why It Is Difficult to Buy a Home Now
Having a bigger space for a growing family and a home office is a good reason for getting a new home. Many home sellers know that first-time homebuyers tend to be unlucky when putting in bids for a new home. First-time home buyers tend to have weak credit scores and limited financial capabilities.
The pandemic has only made it worse because many homeowners do not want to leave their homes. A low supply of houses makes things even more challenging for first-time homebuyers.
More established homebuyers can pay above the seller’s asking price. Such financial capabilities can be difficult for first-timers to go up against. Understandably, sellers want the highest price they can get for their homes. This is especially true if the homeowner has made considerable investments into renovating the house.
There are good changes coming for first-time homebuyers for finding homes and moving cross country. There is a mild cooling spell on the market. The number of houses in the market is increasing. First-time homebuyers should expect a slower rate in price growth soon.
Mortgage Lenders Tighten Their Hold on Credit Scores
You should aim to have a much higher credit score than what it was months ago. Your median FICO score should be about 700 if you want to buy a home and start moving cross country. A more expensive market needs a higher FICO score.
Non-bank mortgage lenders have a median score of 755. Anyone who wants an opportunity to buy a house will have a better chance of doing so with a non-bank lender.
First-Time Homebuyers Need Patience in Buying a Home and Moving Cross Country
It is always challenging for first-time homebuyers to get a home of their own, and today’s market isn’t making it any easier. These challenges have gotten worse because of the pandemic. Even so, there is still hope for first-time homebuyers when it comes to closing on a house and moving cross country.
The good news is that the real estate market is slowly changing for the better. Until then, first-time homebuyers can improve their prospects by aiming for a higher credit score and building a larger housing fund.