Do you think you’re ready to buy a home?  Below are some key things you should know or be thinking about when you get ready to buy real estate in Hawaii.

Buying at the bottom.  Everyone wants to buy at the absolute bottom of the market cycle.  The truth is, we won’t know when the bottom is until six months after it occurred.  April 2008 single family home median prices are below what they were in November 2005.  April 2008 condo median prices are below what they were in June 2007.  If you’re holding real estate for five or ten years, it’s probably safe to buy now.  Real estate is a great long term investment.

Is your financing lined up?  Are you working with a trusted loan professional?  Do you really know what you can afford?  Make sure your financial house is in order before you begin your home search.

Down payment.  You’ll need at least 5% and 20% is much better.  The zero-down mortgage days are gone for the time being.  Your mortgage interest rate will probably be higher if you put less than 20% down.

Credit score.  720 will probably get you the best interest rate.  If your score is below 580, you may not be able to obtain financing at all.

Understand your loan terms.  Take the time to read your loan papers before you sign them.  Ask your loan professional to explain things that are not clear.  We constantly hear homeowners on TV say, "I didn’t understand the terms of my loan."  Simply put, that excuse is no longer acceptable.

What are you buying?  Are you looking for the best deal or your dream home?  They are not the same thing.  If you plan on living in the home for quite some time, it’s better to buy the home that meets your needs.  If you see your dream home today and are waiting for prices to come down, chances are, someone else will be living there six months from now.

If you’re getting ready to buy your first home or are selling and trading up, contact Michael Zimmerman for a no obligation consultation.

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