Open Fields Blog

Buying your dream home can be a huge decision and deciding when the time is right can be even more daunting. Tack on rising interest rates and an ever-fluctuating housing market, and this process can certainly cause some anxiety.

The good news – the perfect time for you to buy a home is exactly when your family is ready to make the leap toward your dreams.

Focus on the Payment, and Think Long Term

Rather than focusing on where interest rates are, you should focus your attention on the purchase price and what your monthly payment will be for your new home. Don’t let an interest rate dictate whether it’s a good time to find your dream home, because chances are, that interest rate will go down.

If you take out a home loan right now and the interest rate is not favorable, it’s important to remember that refinancing is always an option in the future when interest rates are lower.

At GreenStone, we offer an even easier option – without the long process of refinancing. It’s called our conversion program. With this program, you can take advantage of the changing markets to adjust both your interest rate and loan terms with a quick signature and a fee. This process does not require a credit check, any updated financial documents, appraisal or closing costs.

So, how do you know what monthly payment you can afford for your new home? It’s all about budgeting. Start with your monthly income, subtract your monthly bills and expenses, and see how much money you have left. That will give you a good starting point for how much you have to spend to invest in your dream home. For a full breakdown on how to manage a budget, check out this article. To figure out how much your monthly payment may be based on the purchase price and interest rate, GreenStone has a free payment calculator available here.

What to Consider for Your New Home

It can be exciting when you find your dream home, but before you sign on the dotted line, there are plenty of things to consider to make sure it’s actually perfect for you. Two main things to think about include: the costs and the feasibility of the land.

Costs: Outside of your monthly payment, you should also consider other costs you’ll incur before you move in. To start, your lender will require a down payment on your loan. At GreenStone, our standard down payment for a country home on acreage is 20%. If your purchase qualifies for Private Mortgage Insurance (PMI), in some cases we are able to loan up to 95% of the home’s value, which decreases the required down payment to only 5%. However, there are certain criteria, such as acreage limitations, that could impact the ability to secure PMI. Your financial services officer will be able to provide you all the considerations!

You should also consider closing costs on your loan. For estimating purposes, we recommend planning for 3-5% as a good rule of thumb, but it can vary depending on the loan amount, acreage involved, and documentation needed for your loan request – such as if it requires an appraisal or survey.

Your property taxes may also play a role in where you decide to live. You can get an idea of how high your property taxes may be, based on the area you’re looking in, online ahead of time. If you’re looking for a home in Michigan, check out this site. If you’re looking for a home in Wisconsin, check out this site.

Another cost to consider are utilities. It’s no secret it takes more money to heat, cool, and keep the lights on for a larger home. Also, based on your community, you may have to pay directly out of pocket for costs like water, trash, and recycling. You will want to make sure you are able to handle the bills based on the size and location of your home. 

Feasibility:  You may know you can afford it, and the home may be beautiful and have just enough bedrooms for your family, but also want to make sure it’s feasible for you and your lifestyle. Is the home close enough to your job, or are you willing to shell out more money for the fuel each day if the drive is far? If you work from home, you’ll need to make sure you have proper internet access in the area you’re moving. And, beyond the home, does the property provide you the ability to achieve your outdoor desires and needs.

The Housing Market

Over the past couple of years, you have probably heard the term “seller’s market.” That’s because there was a big boom in demand for homes during and immediately after the pandemic subsided.

The good/bad news – that’s changing. Economists are predicting a “buyer’s market” for the upcoming year. That means you may be able to secure a home for a lower cost than in the past few years, however it may also mean there are less homes on the market.