Like many people in Texas, you may have set some goals for the New Year. This year, instead of losing weight or breaking a bad habit, you and your spouse have decided to take the plunge and buy a home.
This is not a decision you are taking lightly. In fact, many people your age seem to have put off buying a home for just the right time. You may be excited and a little uncertain, but financial advisors say you should be alert for some trends in the real estate world in the coming year.
Skipping the starter home
Often, when a couple wants to venture into home-ownership, they purchase a starter home. These are typically condominiums or smaller houses that a couple owns for a short time before selling up to a larger, family home. This may be your situation, especially if you have student loan debt that makes it difficult to save for an adequate down payment.
Nevertheless, you and your spouse may have worked hard and saved every possible dime in order to skip the starter house and purchase the home you really want. As more millennials follow this trend, the prices of homes may begin to shift, creating an even larger gap between starter homes and move-ups.
Rising mortgage rates are still an improvement
Within the past decade, mortgage rates have risen and fallen at dizzying speeds. Most recently, home buyers have enjoyed some of the lowest rates in their lifetimes. In the past few years, low interest on home loans has allowed many people with average incomes to purchase property.
Rates seem to have bottomed out this past year and now are rising quickly. If you are looking at a home, the mortgage rate is going to determine how much house you can afford. Despite its rapid rise, financing is still at a reasonable rate for now, but it is expected to continue rising in 2017.
Tax considerations and unknown factors
You may be wondering how tax laws might change in the coming years. Many are anticipating changes to tax laws, and this may include your ability to itemize your mortgage interest and real estate taxes.
If standardized deductions are increased, a mortgage interest deduction may not be enough for you to benefit from itemizing on your taxes. In addition, Congress is mulling over the idea of eliminating real estate deductions altogether. These are certainly things to consider when you begin house hunting.
When you are ready to make good on your resolution, you will want to ensure every success. Having a real estate attorney on your side is one way to make sure the homebuying process goes smoothly. Your lawyer will guide you through the complicated legal issues of purchasing a home from drafting a contract to closing the deal.