According to many experts, the real estate market is expected to continue growing in 2021, and it’s largely driven by the lasting impact the pandemic is having on our lifestyles. As many of us spend extra time at home, we’re reevaluating what “home” means and what we may need in one going forward.

Here are 4 reasons people are reconsidering where they live and why they’re expecting to buy a home this year. 

1. Record-Low Mortgage Interest Rates

In 2020, the average interest rate for a 30-year fixed mortgage hit a record low 16 times, continuing to fall further below 3%. According to Freddie Mac, the average 30-year fixed interest rate today is 2.65%. Many wonder how low these rates will go and how long they’ll last. Len Keifer, Deputy Chief Economist for Freddie Mac, advises:

“If you’ve found a home that fits your needs at a price you can afford, it might be better to act now rather than wait for future rate declines that may never come and a future that likely holds very tight inventory.”

This sense of urgency is driving many to buy this year.

2. Working from Home

Remote work is a new normal for many businesses, and it’s lasting longer than most expected. Many in the workforce today are discovering they don’t need to live close to the office anymore and they can get more for their money by moving a little further outside of the city limits. David Mele, President at Homes.com, says: 

“The surge in the work-from-home population has rewritten the playbook for many homebuying and rental decisions, from when and where to relocate, to what people are looking for in their next residence.”

The reality is, for some people, working remotely in their current home is challenging, especially when there may be other options available.

3. More Outdoor Space

Another new priority for homeowners is having more usable outdoor space. Being at home is driving those in some areas to seek less densely populated neighborhoods so they have more room to stretch their legs. In addition, those living in apartments and townhomes are often looking for extra square footage, both inside and out.

According to the State of Home Spending report by HomeAdvisor, of the households surveyed, almost half reported spending 27% more on outdoor living over the past year. This is a trend that’s expected to grow in 2021 and beyond.

4. Avoiding Renovations

It’s recently come to light that many homeowners would also rather buy a new home than go through the process of fixing up the one they have. According to the 2020 Profile of Home Buyers and Sellers report from the National Association of Realtors (NAR), 44% of homebuyers purchased a new home to “avoid renovations or problems with the plumbing or electricity.”

Depending on what needs to be addressed, today’s high buyer demand may make it possible to skip some renovations before selling. Many of these homeowners have prioritized buying over renovating for convenience and potential cost savings.

This article originally appeared on Keeping Current Matters

You may also find very helpful: 7 Questions To Ask When You Interview Agents

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As a first-time homebuyer, it’s easy to feel overwhelmed even before you begin your homebuying journey. After all, this is a new process for you and, simply put, you don’t know what you don’t know. First off, there are no silly questions you can ask during any stage of the homebuying process. To help you get started I created a list of 7 questions you can ask a real estate agent before deciding to hire them.

7 questions to ask when you interview agents

Contacting the agent listed on the for-sale sign of a house you’re interested in may not be the best way to protect your interest as a buyer. When you work with your own agent, that agent’s job is to represent your interests. They help research the house, find answers to all of your questions, and serve as your professional intermediary for communicating with the seller’s agent and homeowner.

Naturally, you will want to choose a great real estate agent that you are comfortable with and feel like they have your best interests in mind. Most real estate experts recommend that you interview at least three agents identified by recommendations from friends and family who have bought or sold a house recently. Here are some questions to ask potential agents to see if they are the right agent for you.

1. How long have you been a real estate agent?
2. What kind of experience do you have in this specific market area?
3. Do you usually work with buyers or sellers?
4. How do you usually communicate with clients? What should I expect for response time?
5. How will you help me search for homes?
6. What days and times are you typically available for showings?
7. How will you ensure transparency about any issues you see with a house?

When you set your expectations for communication, home tours, and other information you count on your agent to provide, you have a good chance to establish a productive relationship from the start – which will help you through your homebuying journey.

You may also find very helpful: How to Buy a Home with Less Than Perfect Credit

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How to Buy a Home with Less-Than-Perfect Credit

Buying a home requires having a healthy amount of cash on hand, a solid payment history over at least the past year or two, and a steady income. But you don’t need a perfect credit history. While higher credit scores earn more favorable loan terms, it is still possible for someone with “low” or “average” credit to buy a home.

Getting the government involved

With less-than-perfect credit, you should probably be looking for an FHA guaranteed loan. The Federal Housing Administration is a government agency that guarantees loans provided by authorized lenders. With the FHA backstopping your mortgage, you’ll gain a bit of flexibility when it comes to how much down payment you’ll need. But such a concession comes at a cost.

By making less than the standard 20% down payment, you’ll be required to buy mortgage insurance — not to protect you, but the lender. It’s a pretty significant hit: 1.75% upfront. That’s $1,750 for every $100,000 you borrow. And you’ll likely have to pay ongoing monthly premiums at an annual rate of 0.45% to 1.05%, depending on the amount of your down payment and the length of your loan.

You may want to consider comparing those additional costs to using your financial resources to repair your credit and saving for a bigger down payment instead.

Know your score

No doubt, as a potential homebuyer, it’s important to reduce debt, accumulate as much cash as you can and review your credit history. Knowing your credit score is an essential step, too.

While FHA loans have traditionally been the go-to option for borrowers with poor credit, the bar has been raised a bit in recent years. While it is possible to still qualify with a credit score under 620, those borrowers represent a very thin sliver of total loans — less than 5%. More than half of FHA loans (53%) in 2014 were made to consumers with scores between 620 and 679, with an average score of 680.

Still, the FHA particularly caters to first-time homebuyers, which represented more than 81% of loans backed by the agency last year.

How much home can you buy?

Deciding how much home you can purchase is a matter of knowing what you can reasonably afford. And of course, your lender will determine the amount of the loan you will qualify for. But with an FHA loan, there are other loan limits to be aware of.

Maximum loan values that can qualify for FHA assistance vary by location and range from $271,050 to $625,500. The agency calculates local loan limits on the housing costs in your area. To find out the mortgage limit that applies where you are looking to buy, use this tool located at HUD.gov.

How to find help

While the FHA is the dominant lender for homebuyers rebuilding their credit scores or buying their first home, there are other federal and state programs that can also come into play. One helpful resource is GovLoans.org. A simple questionnaire gathers some basic information about you, your current employment, job history and background. Using the profile information, the tool will guide you to relevant government home loan assistance offered by the U.S. Department of Agriculture, Housing and Urban Development, Veterans Affairs and others.

You may be surprised how many programs are available to help lower the required down payment or provide a more favorable interest rate. In fact, there are well more than a dozen mortgage programs available for potential buyers facing many different circumstances.

Buying a home with bruised credit can be a stretch but can also be a part of a long-term strategy to rebuilding your credit worthiness.

This article originally appeared on NerdWallet.

What to Expect From the Homebuying Process

Buying stuff online has spoiled us with “one-click ordering.” If only buying a house were so easy. A lot of people stumble into the whole thing and try to figure it out as they go. That’s tough; we’ve been there.

From that first home — little more than a cottage, really, but what seemed like such a massive leap of faith at the time — to the urban split-level loft with a view, we’ve made the mistakes. But you don’t have to. Let us break down the homebuying process for you.

How do I even start?

Besides determining what your housing needs are, setting a budget, getting your financial ducks in a row and obtaining a preapproval — which is a lot to do — you’ll also want a firm idea of just what it is you’re looking for. A wish list can be a good tool. Among the potential considerations:

• What part of town do you want to live in?
• Are schools a factor?
• Older home, or newer?
• One story or two? Condo?
• Contemporary or traditional? Something else entirely?
• A fixer-upper or move-in-ready?
• Near public transportation or other amenities?
• How many bedrooms? Bathrooms?
• Yard? Fenced?

These are just a beginning. You’ll have a much longer list once you start brainstorming.

Do I have enough money?

You know about making a down payment. But there are other expenses due before or at the loan closing that you’ll want to prepare for, such as:

• Earnest money, a deposit you’ll make to the seller upon signing the sales contract to show your good faith.
• Closing costs, listed in a good-faith estimate, including an appraisal, credit report, loan origination fees, home insurance premiums, property taxes (often prorated at closing), title insurance, recording fees and attorney’s fees. (The GFE might lump these expenses together, but ask for an itemized list and have your lender explain them to you.)
• An initial deposit to your monthly payment escrow account (if one is to be established).

You will receive a good-faith estimate on the total charges three days before your scheduled loan closing. You’ll also be provided a separate, detailed HUD-1 statement itemizing the fees you will be charged. Expect to pay roughly 3% of the home’s purchase price in closing fees.

Sometimes a seller will agree to pay some, or all, of the closing costs, depending on how competitive your housing market is. Plus, some lenders will allow you to roll the fees into your mortgage (called lender credits) — but then you’ll be paying interest on what could have been a one-time charge. Lender credits, or “rebate pricing,” may also cause the interest rate you pay to be higher.

Compare mortgage rates now

Do I need a real estate agent?

A real estate agent knows what’s selling and at what price; the neighborhoods that are in demand or overpriced; and where the homes are that fit your budget. An agent will also know how long a particular house has been on the market — information that’s not always available online, and which can affect the home’s price and enhance your bargaining power.

But most real estate agents are ultimately working for the seller, in that commission is paid by the seller and only triggered by a sale. That’s why you’ll want to find an exclusive buyer’s agent, if you can. They can be hard to find. However, agents of all kinds are generally bound by state real estate licensing laws to act in a fair and ethical manner.

How long will this take?

You’ll likely view about 10 homes over 10 weeks to find a home you’re willing to make an offer on, according to a survey by the National Association of Realtors. Roughly half of those surveyed said finding the “just right” home was the most difficult part, but even so, there’s lots left to be done.

The entire process from contract to closing (not counting the time you’ll spend getting preapproved for a loan and house hunting) will normally take from 30 to 45 days. A contract timeline is usually no longer than 60 days. Some of the steps involved include:

1. Negotiating and submitting an offer (1-5 days)
2. Signing a sales contract (1-3 days)
3. Securing your financing (21-30 days, sometimes more)
4. Having a home inspection completed (7-10 days)

Unfortunately, after the contract is accepted, it’s mostly out of your hands. Any hitches along the way can sometimes delay the process. If you need to sign an authorization or respond to a request, do it as quickly as you can — and then just wait patiently.

Managing expectations

Buying a home, especially the first time around, will probably leave you with a feeling of information overload. At practically every meeting you’ll be given “helpful” guides, informational booklets and legally required disclosures. That’s why we’re boiling it all down for you — our goal is to limit your homebuying experience to as few surprises as possible.

This article originally appeared on NerdWallet.