Buying a home is always a big decision, with numerous aspects to consider – from location and size, to balancing wants versus needs, to saving up for a down payment.
Medical residents have even more to think about when it comes to home buying, so if you’re a resident and you’re thinking about buying a house, here are a few factors to keep in mind.
The area where you’re located for residency might not be where you come from – or where you’re planning to stay. Uncertainty around location is a big reason why many medical residents are cautious about buying a home during this time.
On the one hand, home buying is for more people a long-term endeavor. But on the other hand, it can be a valuable financial move to purchase a home and sell it when you leave, rather than living in a rental property for the typical three-to-five years of residency.
Look at rent and sales rates in your location, while keeping in mind that when it comes to the future of the real estate market, nothing is certain. If buying a house does make sense, consider an adjustable rate mortgage as these usually offer lower monthly interest rates at the beginning of the loan. Adjustable rate mortgages can be a good option for people who aren’t planning to hold onto their home for the long-term, but be sure to speak with a lender you trust about all your options!
Time and Timing
Buying a house is an exciting, gratifying experience – but it does take time! You’ll need to investigate the market, decide what you want and set a budget, visit open houses, apply for a mortgage, and much more.
As a busy medical resident, be realistic about how much time you can devote to the effort. If you have friends or family in the area, ask them for recommendations for real estate agents nearby who know the market and can help the process go more smoothly and quickly.
It can take several months or even a year to find the right home. Aim to time the process around a period of residency where you feel confident you can devote the necessary time without becoming overwhelmed at work.
Many medical residents find themselves in a tight financial situation, with limited income and possibly student loans to repay. Fortunately, homebuyers now have the option of putting down as little as 5% of the purchase price.
This figure can vary greatly depending on the kind of home and the purchase price. The Loan Officers at HUECU can review all the options with you.
You should, of course, be cautious about rushing into a new home purchase as a medical resident, but at the same time, being open to how buying a house during this time could be a good financial move. Every resident will come to their choice with a different set of interests and concerns – so ultimately, the best way forward is to do your research, add up the numbers, and speak with an expert or two to figure out what’s right for you.