June is National Homeownership Month, but the National Association of Exclusive Buyer Agents (NAEBA), an organization of real estate professionals who advocate for home buyers, cautions that, for some, this may not be a good time to become a homeowner.
According to 2011 NAEBA President Michael Crowley, “A potential home buyer needs to seriously consider at least five reasons that home buying may not be the best choice right now.” Crowley mentioned mixed economic indicators and the potential for the market to turn soft again to a point where first time home buyers could potentially lose their down-payment and time invested in buying a home. “As the association that works to protect buyers and not just promote real estate sales, we sometimes need to stand up and point out these concerns,” he added.
Exclusive Buyer Agency is the practice of representing only buyers and never sellers in a transaction. The company never lists a seller’s property and thus never has a seller as a client.
Other NAEBA members voiced additional concerns:
Benjamin Clark, NAEBA Past President, suggested that buyers should feel they have a significant degree of job stability. “If there is any possibility you could be downsized or let go, or if finding similar employment in your area could be difficult, it might not be a good idea to jump into home ownership at this time.”
David Kennedy, a NAEBA broker from San Antonio, TX stated, “In this market home buyers should plan to stay in the home for at least five years.”
“If you anticipate a significant change in your family situation, it is often better to wait for it to be resolved before you buy a home,” commented Michael Byrd, a NAEBA broker from Grover Beach, CA. “Pending marriages or having children leave the nest can both mean major changes to your space needs and your commuting requirements.”
“Prices are down, but many buyers do not have a handle on repair costs. Many foreclosed and short sale homes have big-ticket deferred maintenance. Buyers, beware that bargain properties may not be a bargain,” says Rona Fischman, a NAEBA broker near Boston, MA.
In addition, buyers often get qualified by lenders based on only some of their expenses. “It is still possible for a buyer to unwittingly over borrow, even in this market. Sometimes the amount that a lender will let you borrow should scare the heck out of you,” says Ed Bartlett, a NAEBA member in Spokane, WA.
NAEBA Executive Director Kimberly Kahl summarizes the concerns by saying, “Potential home buyers should be certain to look before they leap into this market, and that they have someone on their side who will protect their interests during the home buying process.”
