First-time homebuyers have an amazing opportunity to buy a home at more reasonable prices. In fact, they could purchase a home similar to mine for about half as much as it cost during the housing bubble.
If I were a first-time homeowner, I'd buy my house if it was on the market.
Having the flexibility to move
I'm jealous of first-time homebuyers because they have the freedom to buy a home almost anywhere in the country. The housing market is still depressed enough that they can get a good deal. Meanwhile, I'm pretty much stuck in my Florida home for at least another decade as we wait for the housing market to recover. We purchased our home for $183,000, but it may not be worth that much again for another 10 or 20 years.
Getting more house for the money
When we purchased our home, we paid about $100 per square foot. I found out later that some of my neighbors paid even more for their homes. Some paid as high as $140 a square foot. That wasn't atypical during the housing bubble. A friend recently bought into my neighborhood for $65 a square foot. Homebuyers today are paying less for more square footage.
Taking advantage of low rates
First-time home buyers also have the opportunity to lock in on exceptionally low interest rates. I remember how my parents lived in the same house in Maryland for almost 20 years because the interest rates on homes kept going up. At one point in the 1980s, mortgage rates hit 18 and 19 percent. I'm hoping interest rates will stay low for years to come so my children will be able to finance their first homes.
Inheriting all the upgrades
In many cases, first-time homebuyers are able to purchase homes from anxious sellers. Many homeowners have upgraded and renovated their homes for their own pleasure and also for resale purposes. One family friend put in all stainless steel appliances, new countertops and cabinets as well as new upgraded wood floors before she sold her home. The buyer inherited all of those upgrades essentially for free. The home wasn't appraised for more. Foreclosures and short sales in the area brought the value of her home down even though it had nicer, upgraded features.
When it comes to purchasing new homes, new homebuyers also have an advantage. Newer homes come with more energy-efficient windows and better insulation. They are more hurricane resistant. Some friends tell me they pay half as much for their utility bills living in their new construction homes in Florida.
For first-time home buyers that purchase in an older master-planned community, they often don't have to pay the hefty fees that I had to pay.
Even though I would be in a sweeter position if I bought my home today, I still don't regret being a homeowner when the housing bubble burst. I hope to own my house outright in another 8 years, which will land me in an enviable position.
*Note: This was written by a Yahoo! contributor. Do you have a personal finance story that you'd like to share? Sign up with the Yahoo! Contributor Network to start publishing your own finance articles.
More from this contributor:
- Real Estate
- Home & Garden