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Are Things Different Now for First Time Home Buyers?

Starter homes, and all homes for that matter, have always benefited from a steady influx of first time home buyers into the market.  Most first time buyers are in the age bracket when families are being started, after college, and the buyers are frequently in their first job or career position.  However, there are always some who have been renting for many years who also enter the real estate market as first time buyers.

Of course things are different today than they were before the current housing and mortgage problems that began to surface in 2007.  Before that, when prices were surging in some areas and appreciating steadily in most, the first time buyer probably felt some pressure to "get into the market."  Waiting could mean paying more for the same home.  Unless their salaries were increasing at the same or a faster pace than prices, rare in pre-2007 days, waiting would mean that they would be purchasing less of a home or paying up for the same thing they could have gotten last year.

However, the other side of the market was the pre-bust belief that they would be buying an appreciating asset.  There was still the prevailing secure feeling that a home was the best investment they could make.  Many who purchased in the boom markets were in the belief that their growing home equity would contribute to their retirement down the road.

Well, it's a whole different ball game today.  Appreciating prices aren't something buyers expect, at least not for several years down the road.  And, they won't appreciate at the rates of the pre-bust days.  The good news for first time home buyers today is that there are a great many true bargains out there.  Between foreclosures and homes competing with them in a tough market for sellers, real deals can be found.  The bad news is that it's a whole lot tougher to get a mortgage.  Requirements for higher credit scores and down payments are keeping many first time buyers out of the market.  Come in and talk to a mortgage professional though.  There's still low down payment financing available, and there are structured plans to improve credit scores.  First time home buyers can be in this bargain market.

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