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Hoping to buy in the new year? Read on for some important moves that could help make that happen.
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Buying a home in 2024 may not be such an easy thing. As of late October, there was only a 3.6-month supply of available homes, per the National Association of Realtors. And it can commonly take up to a six-month supply of homes to meet buyer demand in full. As such, those looking to purchase a home in 2024 may be grappling with sluggish inventory. And when inventory is low, it tends to lead to higher home prices.
Plus, mortgages aren’t exactly inexpensive these days. Mortgage lenders are no longer offering up the record-low rates buyers saw in 2020 and 2021. As of early December, the typical 30-year mortgage rate was still above 7%.
If your goal is to become a homeowner in 2024, it might take some careful planning. But if you take these steps in the coming weeks, you may find that you’re able to make that dream a reality.
1. Assess your savings
It’s important to buy a home you can afford comfortably, because taking on too much house could mean struggling financially and, in an extreme situation, running the risk of losing that home. If you want to buy a home in 2024, now’s a good time to assess how much is in your savings account and see what down payment you can afford to make.
Keep in mind, though, that you don’t want to empty your bank account for a down payment. Not even close. You’ll need to leave yourself with ample cash reserves for things like moving costs, repairs, and home-related emergencies.
In fact, what you should really aim to do is leave yourself with enough money in savings to cover three months of essential bills on top of the cost of hiring movers and making repairs. So if you’re sitting on $40,000 in savings, don’t assume you have the leeway to make a $40,000 down payment. You may only be in a position to make a $20,000 down payment.
2. Check up on your credit
The stronger your credit, the more likely you are to not only get approved for a mortgage, but snag a more competitive interest rate on one. At a time when it’s expensive to borrow, that’s important.
Another thing to do ahead of your home search is pull up a free copy of your credit report at AnnualCreditReport.com and review it for errors. You’ll want to work on correcting mistakes before you’re on the cusp of submitting a mortgage application.
In conjunction with checking your credit report, also see what your credit score looks like. Your credit report itself may not give that information. However, these days, it’s common for banks and credit card issuers to give consumers access to that number. If you learn your credit score and see that it needs a lift, you’ll know to spend a few months working on that before diving into your home search.
3. Research home prices in your area
You may have your heart set on moving to a specific neighborhood. But if the typical home price there is $400,000 and you know there’s no way you can go above $300,000, you’ll need to shift gears.
You’re better off learning that now than waiting until the new year. So spend a little time looking at listings. If the numbers in your preferred neighborhood don’t work for you, you’ll have more time to find other areas to move to.
4. Find a great real estate agent
Real estate agents are commonly a bit less busy in the winter than the spring and summer, since winter is a less popular time to buy and list a home. If you’re serious about becoming a homeowner in the new year, spend the next few weeks interviewing agents and try to narrow down your choices.
If you wait until spring, you may find that some of the more seasoned real estate agents in your area are booked solid or harder to reach. Plus, you never know when a great property might get listed during the winter, so having that help in place could make it possible to jump on opportunities as they arise.
Buying a home in 2024 probably won’t be a breeze. But if you make these moves now, you can potentially set yourself up for more success.
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