Buying Your First Home Is A Big Deal
A person recently asked me, "Do you celebrate all your (real estate) closings?" The answer is, "Yes." Regardless if the transaction was easy or hard, buying and selling a home is a major accomplishment.
As it's been often documented in the news, living in Hawaii is expensive (especially Honolulu). In addition, real estate prices continue to increase in the Aloha State. With that being said, when I represent millennial, first-time homebuyers, real estate closings are a little more special.
To purchase your first home, when you are in your 20s or early 30s, is an amazing achievement. According to the Honolulu Board of Realtors, the median condo price in 2017 was $405,000. That's not chump-change. To put things into perspective, a friend recently purchased a two story, single-family home in Vegas, built within the past 10 years, in a gated community, for less than $260,000.
If you're thinking or purchasing a home in 2018, here are three things you should know:
1. Your rent is paying someone's mortgage. Say you are paying $1,700/month. That's $20,400/year. Over a span of 5 years, you would have paid $102,000 in rent. If you can rent, there's a chance you can buy. Here's a fun fact...Did you know that you can put down less than 20%?
2. One of the most common things I hear is, "I'll rent until prices drop." According to the Honolulu Board of Realtors. The median single-family price in 1985 was $158,600. Not surprisingly, the median single-family home price in 2017 was $755,000. Keep in mind that Hawaii is an island; there is only so much buildable land. Does our housing market increase and decrease? Of course it does. However, from a long term investment standpoint, prices continue to increase.
3. Lose the "YOLO" mentality and embrace the work-save mindset of the previous generations. It'll be very difficult for you to purchase a home if you're maxing out your credit cards, zero-ing out your bank account, and wanting travel more than you work. In order to purchase a home, you need money. Find ways to cut down your debt and find ways to save.