My new book, Buy, Close, Move In! debuts today. I wanted to take a moment to talk about why I decided to write this book, and what home buyers and real estate investors should know about today's real estate market to be successful.
Why I Wrote Buy, Close, Move In!In 2005, I published a brand new edition of my bestselling book, 100 Questions Every First-Time Home Buyer Should Ask. In that book, I take home buyers step-by-step through the process of buying a first home, starting with the #1 question, "What is a Wish List? What is a Reality Check?", through the closing and beyond.
I didn't know it at the time (well, I suspected the real estate world wasn't quite right), but looking back, we now know that 2005 was a watershed year for real estate in this country - the bubble was just about to burst. Everyone was buying a home and our homeownership rate grew to the highest point in history.
At the end of 2008, it became clear to me that the real estate meltdown would be unlike anything we had ever seen (and hopefully will see) in our lifetimes. There were/are great lessons to be learned, and I wanted to capture some of that in a way that would help home buyers and real estate investors figure out how to buy successfully in a new world of real estate.
The Real Estate Game Has ChangedInterestingly, I began my last book with the idea that everything in real estate had changed. But by 2008, it had all changed again. There is truly a new world of real estate and mortgage finance, with new rules that are being strictly enforced.
- Lenders will now verify your income, assets, liabilities and debts before approving your loan.
- If too many owners in the condo you're buying are late in their assessments, or if the building doesn't have enough cash in reserves, your loan won't be approved.
- Even if your credit history is solid and your credit score is high, if you've changed your bill-paying patterns (even if you're not late), you may not be approved for your loan.
- If you don't have enough cash (including down payment cash, cash reserves, and cash for closing costs), you won't be able to buy a home.
- And yes, there are a few ways to buy a home without putting down any cash (although you'll still need cash reserves), which I detail in the book.
Is It A Good Time To Buy?At the risk of sounding as optimistic as a Realtor, it is a very good time to buy a home or start investing in real estate - as long as you buy the right property, at the right price, and on the right terms. And yet, there are new mistakes that buyers and real estate investors are making in this new world of real estate. I detail a few of them in this new MoneyWatch video.
3 Mistakes Home Buyers Make
Buying Real Estate Successfully TodayIf you want to buy a home or piece of real estate investment property successfully, keep in mind the following:
- Know your numbers: What you can afford, what your credit history says and how high your credit score is right now.
- Steep yourself in information: You need to know what's going on in your neighborhood of choice, what kinds of financing you'll qualify for, and the new rules of real estate.
- Put together a winning team: You'll need a real estate agent, mortgage lender, professional home inspector, and, if you're buying investment property, a 1031 specialist, real estate attorney, tax advisor, and contractor. This team will help you find your own amazing deal and capitalize on the opportunities available in your neck of the woods.
- Buy, Close Move In! 7 Rules Of Real Estate
- 3 Reasons Why Now Is The Best Time To Buy A Home
- Tax Credits for Making Your Home Energy Efficient
- Housing Market Predictions for 2010: How Good Will It Get?
- Tax Credit Daze: Why It Might Take Months To Get Your Home Buyer Tax Credit Cash
- Are You In Loan Modification Hell? Join The Club
- 2010 Will Start With Strong Home Sales. But What Happens After The Home Buyer Tax Credits End?
- Jon+Kate Plus 8 Finally Sell Their Starter Home