The phrase "don’t believe everything you hear" is especially relevant in today’s housing market. There's a lot of misinformation circulating, making it crucial to have a trusted source of information. If you're considering buying or selling a home, partnering with a knowledgeable real estate agent can help clear up common misconceptions with research-backed facts.
One major misconception is the idea that waiting for a market crash will get you a better deal on a home. Unlike 2008, when an oversupply of homes led to a crash in prices, today's market is characterized by an undersupply of homes. This shortage makes it unlikely that prices will plummet as they did in the past.
If you're holding off on buying a home in hopes of scoring a deal after a market crash, think again. The data shows that a crash isn't on the horizon, so waiting likely won't pay off as you might hope.
Another common concern is whether you'll even find a home to buy. If you're worried about this, it might be because you haven't consulted with a real estate expert recently. The inventory of homes for sale has actually grown over the year. According to data from Realtor.com, while inventory is still below where it was in 2019, it's higher than this time last year. This means there are more options out there than you might think. Talking with an experienced real estate agent can help you navigate the current market and find the right home for you.
So, if you’re remembering all that media coverage about record-low supply during the pandemic, you can rest a bit easier. While the market isn’t back to normal just yet, inventory is moving in a healthier direction. And that means as your options improve, you can let go of this now outdated myth because finding a home to buy won’t feel quite so impossible anymore.
I Have To Wait Until I Have Enough for a 20% Down Payment
Many people still believe you need a 20% down payment to buy a home. To show just how widespread this myth is, Fannie Mae says:
“Approximately 90% of consumers overstate or don’t know the minimum required down payment for a typical mortgage.”
And if you look at the data from the National Association of Realtors (NAR), you can see the typical homeowner isn’t putting down as much as you might expect
First-time homebuyers are typically only putting down 6%. That’s far less than the 20% so many people think they need. And if you’re looking at that graph and you’re more focused on how the number for repeat buyers is closer to 20%, here’s what you need to realize. That’s only because they have so much equity built up in their current house that can be used to make a larger down payment for their next move.
This goes to show you don’t have to put 20% down, unless it’s specified by your loan type or lender. Many people put down a lot less. Not to mention, depending on the type of home loan you get, you may only need to put 3.5% or even 0% down. So, if you’re buying your first home, you likely don’t need nearly as much for your down payment as you may think.
An Agent’s Role in Fighting Misconceptions
If you put your move on pause because you heard one or more of these myths yourself, it’s time to talk to a trusted agent. An expert agent has more data and the facts, just like this, to reassure you and help break through any misconceptions that may be holding you back.
Bottom Line
If you have questions about what you’re hearing or reading, let’s connect. You deserve to have someone you can trust to get the facts.
