Berks County first-time homebuyers face a major challenge when it comes to buying a home. There is still a record rise in home prices, despite a slight cooling. The median home price in the U.S. has surpassed $400,000 for the first time ever.

This trend is likely to continue due to several factors. Housing supply is limited, there are a lot of motivated buyers, and mortgage rates are low. Prices are rising for everything, including homes, due to inflation. Since mortgage rates are low, buyers can buy more than they would otherwise be able to, resulting in heated bidding wars.

Additionally, sellers are staying put to avoid a highly competitive buying market, further reducing the supply of homes for sale.

In addition to being unable to obtain materials, homebuilders are also facing a labor shortage.

Where does this leave first-time Berks County home buyers or any buyer?

What Does It Mean to Be Priced Out?

Buying an entry-level home is out of reach for someone who is priced out of the real estate market. A number of factors can lead to first-time buyers being priced out, many of which are converging at the moment.

You may have noticed that the down payment you saved hard isn't going as far as you expected. You might not be able to afford a house if you only saved 20% of the price you were preparing to pay.

So, what can you do?

You might think automatically you should keep renting, but rent prices are going up because of inflation as well, while wages aren’t keeping up, so this isn’t the ideal option.

There are a few things you can do, and none of them might feel ideal, but your options are limited when you’re priced out.

Save More

It may be necessary for you to keep renting and add to your savings if you live in an unaffordable market right now. As a result, you can also wait out the market in some respects. You may need to be patient because it could be a couple of years before you’re able to re-enter the marketing successfully.

It's better to consider your monthly expenses rather than the sales price when determining what you can afford.

Put your money in a savings account if you plan to wait out the market for a while. Some of your savings may need to be invested in riskier, but higher-earning options like stocks.

Change Your Expectations

You can also change your expectations when you're priced out of the market. Due to limited inventory and other factors affecting the market right now, you may have to give up a few items on your wish list.

You could end up buying a fixer-upper that’s more in line with your budget.

For first-time buyers, being humble is key to getting a home in the current environment.

Broaden Your Home Search Geographically

As you might have to give up some of your wish list as far as home features, you might also want to broaden the geographical area you're looking in. Depending on the neighborhood or suburb in Berks County, home prices can differ considerably.

Hire a Great Real Estate Agent

Finally, if you don’t already have a great real estate agent on your side, it would be nearly impossible to navigate the current market as a first-time buyer without getting one. Even if you can find a home you’re able to afford, you may be facing stiff competition.

You will have an edge over other buyers since real estate professionals are aware of properties before they go on the market. They’ll also be able to help you understand your local market so you can adjust your expectations as needed.

By negotiating on your behalf, a real estate professional can reduce your stress. James Ernst has the experience you need to help you navigate this stressful market.

It’s not an easy time to buy a home, but that doesn’t mean it’s impossible. You might wait it out, or you could shift your approach and strategy a bit. Call us today to talk about your home buying options in Berks County.

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