The way the market is right now, there are three types of buyers that really have it the best if they want to buy a home, townhome, condo, whatever, in Steamboat Springs, Colorado.
In fact, if you are one of these types of buyers (you lucky devil) and you haven’t made an offer on a property yet, the question is: What are you waiting for? Certainly not for more money to fall on your head, I hope! (Especially if you are a first-time home buyer, but also if you’re an interested buyer that can get one of these “at crazily-low interest rates right now” mortgages!
So, the three types of buyers who really have it made in this market are:
1. A cash buyer, of course, always has it good because: A. They don’t have to sell a home before they can buy a home. B. They don’t have to worry about getting a loan, (which especially is problematic if you are a business owner used to relying on stated income loans – these are just not happening; at least not at any great rate - or just about anyone that had credit or income glitches in the past two years). C. Sellers love cash; they don’t have to worry about you not qualifying for a loan, and typically you can close on the property faster than when a loan has to be gotten (up to 3 months these days). Because sellers like cash so much (don’t we all?), the home buyer in Steamboat Springs who has cash is in an especially strong place to negotiate!
2. The 2nd home buyer is the next home buyer that has it good right now, and typically for reasons A.(above): Not having to sell a home before they can buy, and B. Although this buyer needs to get a loan, the mortgage rates are so ridiculously low right now that even a possible cash buyer would be smart to save their cash and take out a loan! Savvy home buyers know that there is nothing like using cheap money to help a homeowner grow an incredible amount of wealth!
3. But it’s the first-time homebuyers that really, really, really have it the best right now. Why? Again, for reason A. They don’t have to sell a home; along with the 2nd home buyer’s reason B. Mortgage rates are so low that it is ridiculous to not borrow money to buy a home! But what the first-time homebuyers have over all the cash buyers and the 2nd home buyers is C….(drum roll please)…If they close on their new home by December 1st, 2009 they will essentially get a free check from the government for $8000… as long as they don’t sell that home for three years.
First-time home buyers are considered to be anyone that hasn’t been a homeowner for the previous three years. That flabbergasted me at first – I thought for sure a first-time home buyer would mean someone who truely was a first-time home buyer, meaning: ever! But alas, what did I know!
And I say $8000, because the law says 10% of the sales price, up to $8000. We all know that you cannot buy a home, townhome or condo in Steamboat Springs for less than $80,000, so it is all a mute point since $80,000 x 10% = $8,000 = any home you can buy in Steamboat!
Yes, they get this as a tax rebate, which means they have to wait until they file their 2009 tax return before they see any money. (So, unfortunately no, they cannot use it towards their downpayment, which is a real shame.) But, let’s say they don’t even owe $8000 in taxes. Let’s say they owe $3000. Well, that $3000 will no longer be owed, PLUS the IRS sends them a check for the balance; in this case a check for $5000!
I repeat: The government is paying them $8000 to buy a house! And the mortgage lenders are practically giving money away at such dirt-cheap rates! Can you just imagine how nice that 5% (or less) loan will look in 10, 20, 30 years when the rates could be back up to 18%! Not to mention the appreciated value of your Steamboat Springs home, and all of the enjoyment you’ve had living there!
Yes the first-time homebuyer needs to have had a steady income which looks nice on the past two tax returns, and yes they should have very little debt (ideally not even a car loan) and also great credit. But they don’t even need downpayment money if they qualify for a 100% USDA loan!
As a friend put it: “Oh, I wish I didn’t already own my first home!” But I reminded her: “Yeah, but just think of all the years you have had to enjoy it, and all of the money you have made by not paying rent! Quit complaining!”
If you are a first time homebuyer, give us a call! If you are a second home buyer, give us a call. And if you are a cash buyer, with all of the great inventory available your options are practically unlimited. Everybody else, especially those of us who would A. Need to sell before we could buy something else and B. Wouldn’t qualify for a loan anyway…Well I guess it is just not our time, but remember: Patience is a Virtue! And for those of you that can, it is a great time to refinance!