Real estate: here is how much money you will really need to buy your first home
I am buying the first house: the dream of many. The most critical decision is usually made by a person or a family looking for investment opportunities on the Cyprus marketplace.
Buying a property in Cyprus is an excellent option. In recent years, the mythical island in the Mediterranean Sea has become a destination par excellence for the best real estate investments. There are many locations where to make excellent investments, regardless of the pocket of the interested parties. Paphos, Limassol, Nicosia, and Ayia Napa are among the top picks for those interested.
The most important thing before deciding to buy a property in Cyprus is to save enough money to make the down payment. In any case, it is not the only thing you will need in terms of resources: buying a house involves a lot of associated costs. The amount always ends up being more significant than one imagines. There is a wide range of prices, taxes, and expenses that are unavoidable.
For now, according to a well-known real estate agent with an office in Nicosia, buying a first home is usually the least expensive. First-time buyers are not as presumptuous as those about to buy their second or third home and know how to participate in the resale properties market. Including buying high-quality luxurious properties. And this is where the Cyprus real estate market offers several excellent opportunities for first-time investors.
But it is not all about choosing a lovely home with the help of a licensed real estate. The purchase in the property market has a crucial moment and has to do with the closing costs of purchasing a property. There is a wide variety of costs that are often overlooked. For now, it is crucial to have a sum of money reserved to face these expenses in the real estate industry. And it is not just a tiny amount of money - consider saving several thousand dollars to meet these expenses.
Due to the liquidity that the world financial centers have due to the Covid-19 pandemic, mortgage rates are at their lowest historical values. Anyway, one can access a low rate based on your credit score. Besides, each bank has its criteria for lending money.
It is good to know that there are different types of loans. On the one hand, we have traditional mortgages, with a fixed rate of up to 30 years. There are also mortgages with a speed that adjusts for inflation, which offers lower down payments, which increase over time.
There are also specific sectors of society that can access unique benefits at the time of a loan. Among them are members of the military and retirees, who have some advantages when investing in the estate in Cyprus.
For now, the important thing is to make an initial evaluation of the properties for sale. Also, with our ability to access credit, if necessary. And if we, do it with the assistance of licensed estate agents, it will be much better.
The initial deposit will be the one that arises directly from the funds that we have available if you have requested a loan. The rest of the property value that we will buy will be paid in the long term with the mortgage that we will order from the bank.
It is good to know that the more we pay upfront, the lower the mortgage loan value will be over time. Even banks offer comprehensive benefits to those who make a more significant effort as a down payment.
However, it is not good to spend all the savings on the down payment. You always must keep a reserve for imponderable expenses and situations.
Finally, we have the closing costs, including a lot of taxes and fees that must be paid to finish the operation. These include the application fee, attorney's fees, bank home equity appraisal, escrow, credit report request fees, various types of insurance, and taxes. Typically, these expenses are up to 5% of the costs.
The important thing is to know everything we are faced with when buying a property. Significant investment implies higher expenses but at the same time higher profits in the future. We know where we stand, what our savings are, and the scope of our resources when investing in a property. It is the only way we must make good decisions in the real estate market.