SAN ANTONIO — The pandemic has caused a whirlwind of financial anxiety for people. If you are thinking about buying a home for the first time, here’s KENS 5’s top five things to consider to be Money Smart about your decision.
According to the San Antonio Board of Realtors, the housing market in the Alamo City has not been drastically affected by the coronavirus pandemic. In SABOR’s latest market report, total home sales in April was 2,748, which was an 8% decline from April 2019. But the agency reported 9,498 active listings, which was a modest increase from March. SABOR said 3,543 of those listings were new and that indicated that there was still progress in the city’s housing market.
If you are planning to jump in to purchase your first home in San Antonio, here’s some things to review:
“Interest rates are at the lowest they’ve ever been. So, it is a great time to consider purchasing a home. You also, have to take into consideration the price of the home. Just because interest rates are low doesn’t mean you’re getting a good deal on the house,” explained Karl Eggerss, senior wealth advisor and partner of Covenant. “What does your cash flow look like? Can you actually afford it?"
"Number two, are you going to be in this home for five years or more?" Eggerss said. "Generally speaking, if you’re not going to be in there for five years due to the moving cost, due to the cost of closing and so forth, it usually doesn’t make sense to purchase a home.”
A third thing to take into consideration is the hidden costs of owning a home. According to a report by Zillow, U.S. homeowners pay more than $9,000 in maintenance costs every year. Eggerss further explained other unexpected pitfalls.
“You’re going to be on the hook for taxes. You’re going to be on the hook for insurance. You’re going to have to buy a lawnmower. You may have to buy a new refrigerator, repair the roof every few years from hail damage,” he said.
There are loan options available for buyers and Eggerss recommends to thoroughly go over all of the options. There are different types including a fixed-rate loan, adjustable-rate mortgage, FHA loan, VA loan or USDA loan.
“The other thing to take into consideration is if it’s taking a priority over other goals you have. For example, if this is going to hinder you from saving for retirement too much, you might consider deferring purchasing that home, until you’ve got your savings on a gradual pace that’s increasing, as opposed to cutting your savings to just go buy a home,” said Eggerss.