Working as a Senior Mortgage Loan Officer has afforded me the opportunity to work with a wide variety of homeowners and potential homebuyers. I’ve seen many different motivations for wanting to own property: purchasing a first home, purchasing an investment property or vacation home, and perhaps best of all – finally purchasing a *dream home*.
I’ve noticed along the way that many first time home buyers do not realize that the best way to eventually buy their dream home is to start with buying their first home. Let me explain…
Lets say you bought a home worth $500,000 today with a $400,000 mortgage. Assuming 4% appreciation and a 30 year fixed loan, in five years you would have a home worth over $600,000 and a mortgage of roughly $370,000. You just turned your $100,000 down payment on your first home into over $200,000 that you could put toward your dream home.
“Buying that tiny studio was the most important decision I made because it got me in the game.”
Many of you have probably heard of Barbara Corcoran, a famous real estate investor and judge on “Shark Tank”. I love her success story. She was interviewed by CNBC in 2019 and shared the below snapshot on how her empire first got started…
“Buying real estate has made me rich — mostly through necessity, not by design. I bought my first itty-bitty studio after scraping together a few bucks because I needed to live somewhere anyway.
A few years later, the studio doubled in value, giving me enough cash to plunk down 50% on a one-bedroom apartment. That soon rolled into a two-bedroom, then a three-bedroom, and finally landed me in my 10-room penthouse on Fifth Avenue in New York City.
Buying that tiny studio was the most important decision I made because it got me in the game.”
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