For many young people, owning a house is the dream—the ultimate move of independence. And why wouldn’t it be? Owning a home comes with many perks, such as having a place where you can put your roots down and raise a family or a first step into the real estate business. But with ownership also comes a hefty responsibility to keep up with monthly payments for the house and regular maintenance of its interior and exterior space.
You’ve weighed the pros and cons and decided you want to take this step into real estate life. Are you ready and armed with all the information you need? Purchasing a house for the first time may feel like a daunting task with the myriad of paperwork to look through. Plus, factor in the amount of time and energy it will take to look at house after house. Read on to discover advice we’ve collated for people looking to purchase a home for the first time.
Partner with a Trusted Realtor
The very first thing Kelly Phillips Erb put in her Forbes article “10 Things You Absolutely Need to Know About Buying a Home” was to get yourself a trusted realtor. Quick note: the difference between a real estate agent and a realtor is that the latter is a member of the National Association of Realtors (NAR) and a local real estate association, giving them more experience and a larger network.
Some first-time homeowners think hiring a realtor is an added cost that they can take off their budget. But think twice before going head to head with a home seller sans a realtor beside you. An experienced realtor can help guide you through buying a house, look out for your interests that the seller may not necessarily have in mind, and read through the fine print of any contract you’ll be signing. Unless you are a realtor or very familiar with the ins and outs of purchasing a home, experts highly recommend that you partner with a realtor you can trust.
Consider Your Finances—Present and Future
A house’s purchase price is only one thing to budget for when buying a home. This is a long-term endeavor you’ll be getting into, so make sure to take a good look at your current financial situation. How much do you have in the bank? Minus all the living expenses you will still need to pay every month, will you be able to afford the mortgage payments? How is your credit status? Most home loans require that you have good credit and a history of paying bills on time. And these concerns are mainly focused on your present financial status.
Take into account that the market fluctuates—your current financial status now may not be the same three or five years down the line. Make sure not to bite off more than you can chew when purchasing a new home and leave a bit of leeway for your house payment budget should the market go south and affect your financial status. Furthermore, make sure to research and look for the best mortgage rates that will fit into your plan. Most home sellers will require a mortgage pre-approval, so get all the paperwork out of the way before placing an offer on a home.
Some other costs you may want to consider when purchasing a house as a whole are the property taxes in your neighborhood, homeowners insurance, budget for house maintenance or improvement, and closing costs at the end of your real estate transaction.
Have Your House Inspected Professionally
House viewing is an integral part of purchasing a home. So visiting houses your realtor has chosen that matches your criteria should not come as any surprise. However, consider having a professional home inspector eye your prospective home to check for the building’s quality, safety, and overall condition before signing that blank space with your name. There might be some significant defects the home seller did not disclose to you or there might be too many things that need major upgrading that might not be worth it to you. Having a second set of eyes can help you decide to forego the house or can help you renegotiate with the seller to have the defects fixed on their wallet or get a discount on the house.
Again, purchasing a house is a big venture—no matter what age you are. Before taking the plunge, make sure to research well into every step and follow the advice listed here for your benefit. Wishing you all the best as you begin your dream home search!