gmhTODAY 10 gmhToday Sept Oct 2016 - Page 45

How much to save daily for a downpayment F or homebuyers, especially fi rst-time ones, the scariest part of purchasing a home is putting together the down payment. The down payment has become an Everest- sized mountain they need to climb to reach their dreams of homeownership. In these days of rising home prices, it seems harder than ever to pull together the amount of money needed to get yourself into a new place. Realtor.com has estimated just how much you would need to save per day based on the area where you live or would like to purchase a home. The big lump sum you will need is easier to grasp when you break it down into daily savings. For example, let’s look at San Francisco’s median price (one of the top 15 regions included in the Realtor.com estimates) and you can adjust it by the Bay Area region you live in. We are using the average percentage that buyers in those areas put down on a home. Using those figures, we calculated the typical down payment for the city or area. Next, we figured out how much potential buyers need to save each day toward a down payment, over five- and 10-year timelines, to reach their goal. (We’re making the big assumption that home prices and subsequent down payment percentages remain unchanged over that time.) In saving for your down payment you will be preparing yourself to be up to the task of paying the monthly mortgage, your insurance, your property taxes, maintenance [costs], and what we like to call your emergency fund for emergency repairs. The recommendation is for buyers to take all their tax refunds and bonuses and put them away for their down payment. If you stop going to Starbucks to save, be sure you actually put that money away daily to benefit your savings. SAN FRANCISCO, CALIFORNIA Median home price: $875,000 Average down payment: 21.8% ($190,750) Daily saving goal (5 years): $104.46 Daily saving goal (10 years): $ 52.23 There’s no easy way to say this: Buying an abode in San Francisco or the Bay Area isn’t cheap. Some good news: While it remains one of the hottest real estate markets in the U.S., in June we started to see higher-priced homes flying off the market just a wee bit slower than before—perhaps a sign that the tide is finally turning somewhat. Still, buyers shouldn’t hold their breath waiting for prices to soften on the city’s “affordable” residences. If you are in the South County region of Santa Clara County the median price is lower. This is a guideline you can adjust for the type of home you are saving for. It seems a long time to save but if you start now and put all extra money away in a separate savings account it will grow fast and can become a fun experience to see it grow. Birthday money or cash gifts can make it grow even faster. There are other programs that can help you get into a home for as little as 3.5%. Right now there are many loan programs available to make home buying a reality so talk with your lender or call me or your realtor and we can help you through the process and set you up with a good loan agent to get you pre-approved. That is the first step when you are ready. Get ready and SAVE!!!! June Fast Facts Morgan Hill May April 127 109 109 Homes Sold 55 61 43 Average Days on the Market 27 19 23 101.4% 101.6% 99.8% Active (Homes on the Market) Sale to List Ratio Teri Nelson, Realtor Intero Real Estate Services 408.425.5200 BRE#00858151