Many people are looking at their homes differently due to the recent pandemic, as a home and as a workspace. Improving their home office, wanting more space and low-interest rates are contributing to the increasing demand for new homes.
However, finding that new home may not be easy. New listings in the month of May were down almost 20% percent from the same time last year according to the National Association of Realtors.
Buyers need to be ready with their pre-approval when shopping for a new home. With limited inventory, potential buyers may need to widen their scope when shopping, such as expanding their search by a few miles.
Another great option for potential homebuyers is looking at fixer-uppers. Taking advantage of a renovation loan program, such as an FHA 203(k) loan, enables homebuyers to finance both the purchase and renovation of the home through a single mortgage. Renovations can include updates on appliances, painting, kitchen and/or bathroom remodels, energy-efficient improvements, plumbing, roof repairs, and more.
Rather than paying a premium for a home in “perfect” condition, homebuyers can take advantage of discounted prices available on foreclosures or other homes on the market that are in need of repair or remodeling. Homebuyers are able to purchase more home for their money and in a more desirable location.
It is important to do research and have a detailed home inspection when looking at fixer-uppers to know exactly what needs fixing. Keep an eye out for major issues in the house, such as structural damage in the foundation or roof. Buyers need to decide how much money they are actually saving by buying the fixer-upper once all the costs are added in.
Although remodeling and even minor repairs will most likely take longer than expected, it can be well worth it to have the dream of your home. Widen your search to include those diamond in the rough homes and speak with a GO Mortgage Home Loan Advisor to learn more about renovation loans.