Seattle Washington Real Estate

Being a First Time Home buyer in Seattle presents new challenges

The current malaise in the Seattle home buying market creates opportunity, interestingly is is frequently said that the Chinese word for “crisis” is the same as that for “opportunity. Can this really be so?  In the current Seattle home slowdown there is opportunity of Seattle home seller anxiety, which creates your opportunity.  Did you know that “the average homeowner today has 36 times the wealth of the average renter” according to the Federal Reserve Survey of Consumer Finances.

It may just depend on you.

It is really difficult to get to the point of being a first time home owner in Seattle WA. It means that you have to plan on becoming a home owner. You have to effectively manage your debt, watch your credit and bill paying habits. Lenders are looking for home buyers with excellent credit histories.

Being a first time home owner means that you probably won’t end up in your parents home, you will likely have to compromise with something smaller, more affordable. Something that doesn’t strain your budget and make you a slave to your home, something that you can comfortably afford.

Unfortunately debt to income ratios used by lenders have gradually increased from 28/36 (that is 28% of you income can go towards principal, interest, taxes, insurance and any homeowners dues and by adding all of your monthly debts your monthly obligations could go to 36%) to as high as 55-60% total debt ratio. That’s being a slave to debt!  Now lenders are being more prudent, with ratios (and other measures of responsible lending) are trending down significantly.  A sign of the times.

This is where you need to take a hard look at the magic reality mirror and ask yourself what you can “comfortably” afford. I always say that it is better to hop on the caboose than to miss the whole train. Sound advice!

Owning your own Seattle home, like your parents did, will build amazing equity over time and do equally amazing things for your life. Seattle Home ownership has always been the sure fire way for most people to participate in the American dream. In fact about 60% of the Seattle homes are owned by owner occupants, people like you and me.

Here’s where your situation comes into play. Most people need to buy something less than they imagined at first and build from there. Maybe you don’t, it depends on your particular financial situation.

So, that’s the situation for Seattle WA first time home buyers

Realizing that you may not be getting the same home as your buddy who bought years ago, are there still homes in the Seattle real estate market suitable for your first time home buyer needs? Yes, there are real estate options available in the Seattle real estate markets. You just need to explore options of where the homes you can comfortably afford to buy live. Seattle WA neighborhoods like the rapidly transforming Rainier Valley, Rainier Beach, Skyway, Renton WA, Burien, Tukwila, Beacon Hill all have patches of affordable homes. The really great thing about these Seattle neighborhoods is that, with gas prices and congested freeways, you will find home values going up faster in these Seattle neighborhoods as demand increases from people trying to move closer to work.

Another option for Seattle first time home buyers is the buy a condo or town home. Then there are single family homes which need some work, which represents the opportunity for a bit of instant appreciation through “sweat equity". Maybe a bank owned home would be the ticket.

If you are going the bank owned, or “short sale” path, you are going to need to possess a lot of patience as these sales contracts need to be approved by a bank and that can take much longer than you anticipate. Don’t give up your apartment yet.

Even with the current credit crunch there are programs ranging from minimum down Conventional mortgages, FHA and Seattle’s HomeSight program. Contact me about details of the Homesight program, a great benefit for Seattle first time home buyers.

You need to consider financing early on in the home buying process. Get mortgage pre-approval before you begin your search, who know- you may qualify for more home mortgage than you thought. Getting pre-approved means much more than “yes here is how much home you can afford to buy". It means that you definitely need to be working with a trusted mortgage professional that will counsel you on the loan programs that will best fit your lifestyle, risk attitude and goals without stretching you too far.

That is why I recommend the guys over at Columbia Financial Group. They are great at what they do. I know it to be true and you will appreciate their efforts on your behalf. My son and his associate are like me, good at what they do, honest and ethical problem solvers.

Call us today at 206-575-7495 and select extension

302 for Tyler Todhunter or

303 Fernando Rodriguez, Se Habla Espanol

Columbia Funding Group

Tyler Lic# 510-LO-39638 Fernando Lic# 510-LO-37536

Remember what I said earlier, look for what you can comfortably afford, not as much as you can qualify for. And there is a difference!

So what do you do next? Call me, Dick Todhunter at 206-898-3776 or Contact Us,  to help you get the ball rolling!  Then, get searching for your Seattle WA dream home! My web search tools are great for getting your education about the neighborhoods, schools and home values.  What you have to pay for what you get. 

Yes, it may be a first time home, but you will still be living the dream of home ownership!     

UpFront Mortgage Association member.  Founded by  “The Mortgage Professor”

The Upfront Mortgage Brokers Association (UMBA) was founded for consumer advocacy. Members of UMBA are mortgage brokers whose interests are fully aligned with those of the consumer.