Georgia Homes for Sale: A Guide for First-Time Buyers

With its low cost of living and a burgeoning job market, the Peach State is one of the most attractive destinations for first-time home buyers. However, it can be difficult to navigate the real estate market to find the perfect property for your needs. You probably have many questions about the process of buying Georgia homes for sale and what to look out for. But don’t worry—we are here to help!

This article will cover everything you need to know as a first-time homebuyer, from the current real estate market to the best way to save money on your purchase. Let’s get started!

Georgia Housing Market: An Overview

Before taking the plunge, it is important to first understand the current real estate market in Georgia.

Currently, Georgia is a seller’s market with homes selling quickly. Prices have been steadily increasing over the past several years. If you study the trends in real estate marketing, you will find out that, like some states in the US, selling a house here is relatively easy at the moment. For buyers, this means competition for desirable properties is fierce. So, if you find a house that you like, it is wise to act quickly.

However, the median home price in Georgia as of July 2023, according to the Georgia Association of REALTORS, was $358,000, which is way lower than the national average of $406,700. This means that it is still a relatively affordable market for first-time homebuyers.

As for the mortgage rates, the state also has some of the lowest available in the US. The average 30-year fixed mortgage rate stood at 6.78%, which is lower than the national average of 6.94%. So, if you buy a house in Georgia today, you will not be paying an arm and a leg for the total amount that you have to pay for it.

Overall, the housing market in Georgia is very attractive. With the combination of affordable prices, low mortgage rates, and a seller’s market, now is an excellent time to start your house-hunting journey!

What Are the Main Requirements to Buy a House in Georgia?

As in any other state, buying Georgia homes for sale has certain requirements for the buyer. These include the following.

Financing

Before you can start looking at homes for sale in Georgia, you will need to secure financing. Getting pre-approved for a mortgage is the best way to do this. This helps make sure that you have the means to purchase your dream home when you find it.

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When taking out a mortgage loan, here are things that lenders would look into to approve your application.

Down Payment

The typical down payment on a home in Georgia is between 3% and 20%. The exact amount you will need to put down as a deposit depends on the type of mortgage loan you are taking out. Conventional loans typically require at least 20% for a down payment, while FHA (Federal Housing Administration) loans typically require as little as 3.5%.

Apart from the down payment, you also have to pay closing costs and other fees. Closing costs can range from 2% to 5% of the price of the home, and include things, like title insurance, appraisal fees, attorney’s fees, etc.

Credit Score

Your credit score is an important factor in determining whether you will be approved for a mortgage loan or not. In Georgia, borrowers are expected to have a FICO score of at least 620. The higher your credit score, the better terms and rates you can expect when taking out a loan.

If you see some discrepancies on your credit report, it is important to address them before you apply for a loan. You can do this by gathering supporting documents to dispute the incorrect information so that it can be removed from your report.

Debt-to-Income Ratio

Another important metric that lenders would look at when approving loans for those who are looking to buy Georgia houses for sale is the debt-to-income (DTI) ratio. To calculate it, you can divide your total debts by your gross income per month. Typically, lenders would look for a DTI of no more than 43%, although this can vary depending on the loan type and lender.  

Loan-to-Value Ratio

The loan-to-value (LTV) ratio refers to the percentage of the total cost of the home that is covered by your loan. The LTV ratio for Georgia mortgages can range from 80-95%. The higher the LTV ratio is, the higher the risk for the lender.

Private Mortgage Insurance

In some cases where you are allowed to offer a very low down payment, you may be required to take out private mortgage insurance (PMI). This is an extra monthly fee that protects the lender from default. The amount of PMI you are required to pay depends on your LTV ratio and credit score. 

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Other Documents

In addition to financing, you will also need to provide other documents in order for your purchase to go smoothly.

  • A valid photo identification
  • Proof of address
  • Income documents, such as pay stubs and W2 forms
  • Bank statements for the last two months
  • Tax returns for the last two years

These documents help lenders confirm your identity, income, and ability to repay a loan. Having them ready will help speed up the loan application process.

Steps to Take When Buying Homes for Sale in Georgia

Buying Georgia residential properties requires a bit of research and preparation. Here are some steps that you should take to get the most out of your house-hunting experience.

1. Establish a Price Range

Determining your budget will narrow down your search significantly and help you focus on properties that are within your price range. When deciding on a budget, make sure to take into account all costs associated with buying a home. These include the cost of the down payment, closing costs, and any other related fees.

It also helps to browse Georgia homes for sale to learn about the current market prices for properties in the state.

2. Know What You Want and Need in Your Next Home

Take some time to think about what your ideal home looks like. Make a list of features that you want in your next house, such as the number of bedrooms and bathrooms, or a backyard for entertainment purposes. This will help guide your search and save valuable time.

3. Seek Help from a Real Estate Agent

Searching for homes for sale is an exciting process, but it is easier said than done. The market can be overwhelming, and it can be difficult to know which homes are worth looking into. This is why having an experienced real estate agent on your side can help make the process easier.

These professionals have access to comprehensive and exclusive Georgia real estate listings that you would not be able to find on your own. They can also provide valuable advice and insights into the market, helping you make more informed decisions throughout the process. 

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4. Check Potential Properties in Person

Once your agent has a short list of properties that suit your criteria, it is important to check them out in person. This will give you a better understanding of the properties, their condition, and whether they have what you are looking for in a home. It also allows you to get a feel of the surroundings.

5. Negotiate an Offer

At this point, you should have already chosen the home you want to purchase. It is time to make an offer and start negotiations. An experienced real estate agent can help with this process and ensure that your interests are protected throughout the entire negotiation.

Tips for Successful Negotiations with Sellers

With a bit of negotiation skills, you can surely get your hands on affordable homes in Georgia. Here are some tips to keep in mind when negotiating with sellers.

  • Try to avoid discussing the price first. Start by talking about other elements, like the closing date and repairs needed for the property.
  • Research recent sales of similar properties in the area. This is a great way to know how much you can offer without insulting the seller or underpaying the property.
  • Make sure that all terms are clear and in writing. This is to ensure that both parties understand the agreement.
  • Show a sincere interest in the property and express it to the seller.

Once you have successfully negotiated an offer, make sure to submit it as soon as possible.

6. Finalize the Home Purchase

Once both parties have agreed on a price, it is time to complete the purchase. You will need to sign a lot of documents and pay a down payment (if necessary). After all these have been done, you will be able to finalize the purchase and move into your new home.

Begin Your Georgia Home Search Today!

Finding and buying Georgia homes for sale can be a daunting process, but it does not have to be. If you take the time to do your research, secure financing, and seek help from experienced professionals, you can make your purchase a success. Start your search today and find that dream home of yours!

For more real estate news, tips, and information, check out our other posts!