There is nothing like buying your first home. Whether you are looking for a fixer-upper, a place to spend the next few decades or something in between, there is no mistaking that your first home is a huge decision. It is also one of the biggest investments you are ever going to make. Be sure you are getting the home you expect by following our tips for first-time home buyers.
One of the biggest problems that confront new homeowners is that they don’t think ahead. For instance, before you start looking at homes, determine how many rooms you need. Do you plan on having children? Do you like to entertain? Will you possibly be caring for an elderly family member? The answers to these questions will help guide you. While you may be able to build on later to accommodate a growing family or elderly relatives, expansion is not an easy possibility, be it for the property or your wallet.
Be Clear on What You Want
Your emotions can also put you at risk when you are a first-time home buyer. After all, this house is going to be your home—where you make some of your happiest memories and live with your family. As you look at different properties, you’ll imagine yourself and your family in each of the rooms. Sometimes, you will fall in love with a house that doesn’t quite meet your needs. You start to compromise. You decide that you can live without a home office because the house is in your favorite neighborhood or it has an in-ground pool that the kids will love. Three words —don’t do it. Before you ever meet with a realtor or look at properties online, develop a checklist of your must-haves and stick to it.
Decide on Your Budget
Your budget is also a slippery slope. It can be easy to focus solely on your mortgage payment, but owning a house costs a lot more than that. Aside from the taxes and insurance that is often looped into your home loan, there are other costs you need to consider, like the average utility bills for the property, commuting costs, homeowner association fees, lawn maintenance and the cost of general home repair and maintenance.
If you don’t include these factors in your budget, you could leave your finances stressed. First-time home buyers are especially vulnerable to these miscalculations because they are unaware of the hidden costs in purchasing a home, like the cost to fix a clogged sink or repair shingles after a bad storm. Take your time, ask questions and do your research so that you can decide on a budget—and stick to it.
Look at the Current Situation
New homeowners are often sold larger properties in less desirable neighborhoods with the idea that the section of town will improve over time. Sometimes, that strategy pays off. The neighborhood improves and you bought at a low price—but there are two problems with this. One, the neighborhood may not improve as soon as you expect, if ever. It could even get worse. In the end, you risk being stuck with a great property in a bad section of town. The second risk is that your plans might change before the neighborhood does. Avoid or lessen this risk by considering resale value of the house from the very beginning.
Research Your Neighborhood
You will also want to research your neighborhood. Beyond the section of town you are considering, consider what it means to live in a particular house. One major issue is the local homeowners’ association. For example, let’s say you are looking at a house that has a mother-in-law suite. Your plan is to rent it out for the next several years, until one of your parents wants to move in. You need to check the homeowners’ association agreement first. This may not be allowed. Moreover, even if there is no homeowners’ association, the town may have restrictions on what you can do with your house. There may be historical associations to consider as well as city zoning, so make sure to do your homework.
Don’t Be Misled
Keep in mind that the way that house you love looks today may not be how it looks tomorrow. The first consideration is staging. Some people use professionals to style the houses they are selling, and it can be misleading. For instance, just because you see lamps on either side of the master bed, it doesn’t mean that there are outlets there. Similarly, it can be easy to overlook a house because you hate the color of the walls or it has outdated wallpaper. These are both factors that are cosmetic and easily corrected. You will be better off paying attention to location and layout of the home than the way it looks when you do a walk through.
By Malka Abrahams