Rob’s April Update

Managing Partner, Rob Riddle, talks about the current real estate market and how parents can assist their kids to buy their first home

New Subset of Buyers Enter the Market

Many of the battle-hardened buyers from the spring have found their homes. We’ve now got this new buyer who is not quite as eager or worried due to the nice flow of listings. As things slowly start to return to normalcy, we’re seeing the market begin to soften and buyers are not feeling the same pressure to buy the first home they see. 

Should Your Recent College Grad Buy Their First Home?

Many parents question whether this is a good time to encourage their kids/recent college graduates to invest in real estate? 

The market is hot and prices are high but interest rates are also at historic lows. Dr. Ted Jones, the chief economist at Stewart Title, pointed out that while everybody realizes that housing costs are high right now, people overlook that affordability is about as good as its ever been. Home prices are at record highs in some areas, but because interest rates are so staggeringly low, the cost of owning a home has never been more affordable. In Columbus for example, the median home price is about $250k and the median income is between $30k and $50k. At current interest rates, the monthly payment on a median-priced home is the lowest percent of a median earners monthly pay as we’ve ever seen. Additionally, with the rising cost of building materials and labor, housing won’t become any less expensive while rents go up.

There are costs associated with owning a home, and while you’re renting, that’s not a concern. You are still paying that cost; however, it’s in your rent payment. You’re not building any equity as a renter. An important thing to consider if someone is thinking about buying their first home is how long they plan to live there. If there is potential, they may not be there for at least 3 years; they’re better off renting. As a general standard in Central Ohio, you can expect real estate to appreciate 3-5% a year. Despite the affordable housing crisis, this is still an excellent time to buy a first home, given that you know you’re going to stay for at least 3 years to establish equity and realize a gain when you sell.

What is required from somebody to make a competitive offer on an existing home in this market is substantial. We’ve had dozens of clients whose parents assisted their children by giving them the cash to buy the house. Offering cash allows their child to get the best buy possible in this market. Then on closing day, their child gets a mortgage, and the parents get their cash back.

There are other ways to help your child buy their first home. You can be a non-occupant co-borrower, which won’t cost you anything, but it will increase your child’s buying powers. Additionally, you can offer to float them the cash to provide appraisal gap coverage.

If you’re looking to help your child find their first home and navigate this market, Thomas | Riddle has agents ready to help you. Being an established top team in Central Ohio, our ultimate goal is to aid our clients every step of the transaction. Regardless of the price point, sound advice and experience are more critical than ever in this market.

Riddle Family Update 

This month, Stanley turned 3 and had an awesome dinosaur-themed birthday party. We feel fortunate that we could celebrate with family again because we weren’t able to last year. At the tender age of 5 months, Charlie adores his big brother and looks up to him. Johnna and I are looking forward to being outside more with the kids as the weather warms up. 

Share this post

Recent Posts

Real Estate News in Brief for February 2024

There’s a palpable excitement in the market as the spring selling season nears. The Fed may have kept rates on hold, but the market is expecting interest rate cuts in the near future. After two years of 15–20% pa declines in transaction volumes, there could be a big rush if mortgage rates drop significantly.

Read More »

Get in Touch

Have questions? We’re happy to help. Ask us here and we’ll get back to you right away.

Compare listings


Get Started With A Free, No-Obligation, Market Analysis.

As full-time and fully dedicated real estate agents, our sole focus will be on your sale and your happiness. We will always be a call, email, or text away to advise you as needed.

Get Your Updated Home Value

Where should we send your updated home value?

Anything else we should know?

Note: Please be assured we will use this information only to send you the information you have requested and we will never share or rent your contact information with any other party. By giving us your name and email address, you are giving Thomas|Riddle Real Estate Group permission to contact you.