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    13 Rules Today’s New Home Buyers Can Learn From The Past

    The zero-down, risk-everything days are over. Time to go back to money basics for buying your first home.

    Many of today’s first-time home buyers are millennials, and they are getting married, starting families, and stepping into the real estate arena for the first time. This generation grew up in a real estate boom, followed by a bust and an incredible decade of home-price escalation, wide-scale under financing, and subprime lending.

    Seeing first-hand the housing market’s up’s and down’s, millennials might need guidance in what rules apply to them. GOOD NEWS! These rules are the same tried-and-true rules of home buying from years past.

    Here are 13 rules for millennials looking to buy — while avoiding another burst housing bubble.

    1) If you can’t afford the home, don’t buy it.

    2) Don’t purchase a home blindly. Research and learn about the area, get advice from others, and study all the available data.

    3) Avoid “creative financing”: buy properties with a traditional 15- or 30-year loan. Its less anxious knowing your mortgage payment will be the same each month for the entire mortgage term.

    4) Always put down 20% of the purchase price.

    5) Buy a house for 20% less than the amount the bank is willing to lend and you’ll never be house poor.

    6) You’re not just buying a house, you’re buying a neighborhood. Search the area, and make sure it is a right fit for you.

    7) It’s tough to qualify for a mortgage; plus, qualifications are more stringent these days. Keep great financial records, and be patient throughout the process.

    8) Don’t expect the market to appreciate and create more value in your home. Don’t overpay for a house you can’t really afford in hopes of market appreciation making up the difference.

    9) Less is more. A smaller, practical, easy-to-maintain house is the new, big, rambling mansion.

    10) Actively manage your credit, and shoot for an excellent score (above 750).

    11) Plan to stay in your home at least five years. Think you’ll need to sell before then? Then forgo home ownership and keep renting until you are ready to settle.

    12) Budget for all the costs of home ownership — not just the monthly mortgage payment. Be sure you have the funds for property taxes, insurance, upkeep, and even an emergency repair fund.

    13) If your job security is in question and your industry flat, don’t buy yet.

    For a generation who may think risking everything and buying homes with zero down is the norm, these rules may seem new. But as the saying goes, everything old eventually becomes new again.

    In this new era, millennials simply need to take a cue from the past to buy safely and securely in the current housing market.

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