If you’re feeling confused, you’re not alone! Buying a house is a significant milestone with a complex process often surrounded by myths and misconceptions that can cloud your judgment.

Whether it’s the idea that you need a perfect credit score, a hefty down payment, or that renting is always the cheaper option, these myths can deter potential buyers from making informed decisions.

In this blog, we’ll bust 10 of the most common homebuying myths to help you navigate the path to homeownership with confidence.

Lucca Floor Plan, Estate Collection, Livingston Community, Calgary, Alberta

Myth #1: You need a 20% down payment

While a 20% down payment can help avoid private mortgage insurance (PMI) and secure better loan terms, many lenders offer mortgages with much lower down payment requirements. FHA loans, for example, may require as little as 3.5% down, and VA loans may not require any down payment at all.

Myth #2: You must have perfect credit

While having good credit helps secure better interest rates, it’s not a strict requirement for getting a mortgage. Various loan programs cater to buyers with less-than-perfect credit scores. Lenders often work with buyers to improve their credit or find suitable loan options.

Understanding your credit score’s ins and outs is crucial when buying a home. Check out our Complete Guide to Credit Scores, where we demystify the concept of credit scores, address common questions that homebuyers often have, and shed light on how your credit score can impact every step of the homebuying journey.

Myth #3: Renting is always cheaper than buying

A question you can’t overlook when your living situation changes is: “Is it better for me to rent or buy a home?” While renting might be more affordable in the short term, buying a house can be more cost-effective in the long run. Homeownership builds equity, provides tax benefits, and offers potential appreciation in property value.

You’ll want to evaluate your personal situation, including job stability, long-term goals, financial health, and local market conditions, to make an informed choice.

Myth #4: You should buy the biggest house you can afford

Bigger doesn’t always mean better. While buying the largest house you can find in your budget might be tempting, that’s not always the best financial decision. There can be additional costs you might not have considered, such as higher property taxes, maintenance costs, and furnishings.

Buying a home that meets your current needs rather than one that maxes out your budget can provide greater financial flexibility for other priorities, like saving for retirement, your kids’ college tuition, traveling, or investing. It’s all about finding the right balance between size, affordability, and personal comfort.

Myth #5: You can’t buy a home with student loan debt

Having student loan debt doesn’t automatically disqualify you from buying a home. Still, lenders consider your overall debt-to-income ratio, so any outstanding loan balances can affect how much home you can afford. Fortunately, many lenders understand that student loans are a common part of modern financial life, and showing you can manage your debt responsibly can improve your credit score and make homeownership possible.

Residence 2 Floor Plan, Sundance Neighborhood, Rosewood Community, Morgan Hill, California

Myth #6: You should wait for the perfect market conditions

Trying to find the “perfect” housing market is challenging, and if you wait for it to exist, you may miss out on great opportunities. Market conditions can (and will!) fluctuate. If you wait for home prices to drop, you might miss out on low mortgage interest rates, resulting in higher overall costs even if home prices decline slightly. Conversely, waiting for interest rates to drop further could be a gamble, as they might rise instead, making home loans more expensive.

Ultimately, the “perfect” time to buy a house is when you are financially ready and have found a property that meets your needs and budget. Real estate is a long-term investment, and while market conditions can impact your purchase, they shouldn’t be the sole deciding factor.

Myth #7: A 30-year fixed-rate mortgage is always the best option

While 30-year fixed-rate mortgages are popular due to their predictability, there might be better options for some homebuyers. Other mortgage types, such as 15-year fixed-rate or adjustable-rate mortgages (ARMs), may offer lower interest rates or better suit certain financial situations.

Our blog, Fixed vs. Variable Mortgage Rates: Which One is Right for You?, explores both mortgage rate types, important differences between fixed and variable interest rates, and answers to some common questions.

Myth #8: The down payment is the only upfront cost

The overall “cash to close” refers to the total amount of money a homebuyer needs to bring to the closing table to finalize the purchase of a property. When you signed a purchase agreement for your home, you likely made an earnest money or initial deposit, which is applied toward your total down payment. Your remaining down payment is typically the largest portion of your cash to close, with the rest of it made up of closing costs, escrow and prepaid charges, and any additional fees.

Myth #9: New construction is always more expensive than existing homes

An important question you may not be considering in your homebuying journey is whether to buy new construction or a resale home. It’s a common misconception that new construction homes are always more expensive than existing resale homes. Even if the initial price tag seems higher compared to similarly sized older homes, several factors can make new homes a better investment in the long run, including lower maintenance costs, smart home technology integration, and energy-efficient systems.

Myth #10: All homebuilders are the same

Some buyers assume that all homebuilders offer the same quality and service. In reality, the quality of construction and customer service can vary significantly between builders. It’s essential to research and choose a reputable homebuilder with a track record of high-quality work and good customer satisfaction.

For more than 65 years, Brookfield Residential has been creating the best places to call home. As a land development and home building leader, we continue to maintain the same solid values that have helped us successfully navigate through decades of growth and change.

We’re committed to serving our customers from day one in their new home journey and beyond. We want our homebuyers to feel comfortable, in the know, and in good hands from the first time we connect to long after you’ve moved into your new home.

Mariposa Collection, Blossom Rock Community, Apache Junction, Arizona

Shopping for a new home is one of life’s most exciting (and sometimes stressful) times. Check out our tips on avoiding information overload when home shopping and connect with our sales team to learn more about the homes and communities we offer and our current incentive programs. We’ll be expecting you!