Ten things to consider when buying your first home
Buying your first home can be an intimidating decision. Not only will it likely be the biggest purchase of your life, but it is oftentimes both a lengthy and complex process.
It goes without saying that there are many factors to consider as a first-time homebuyer. There’s a lot to learn, and a lot to know, about a process that commonly takes months to complete from start to finish. Even when things go smoothly, a first-time homebuyer will require patience, organization, and knowledge to navigate through the process.
Here are 10 things to consider when buying your first home:
The difference between wants and needs. When you have a clear understanding of what you want versus what you really need in a home, you will be in a position to make decisive, effective decisions that might help you land what you really want.
Getting pre-approved for a mortgage. Not only will you avoid homes you can’t afford, but pre-approval from a lender will give you the leverage to make a serious offer when you find the right home.
The real cost of homeownership. Sure, there is a mortgage payment, but what are the costs of living where you are buying? When you factor in all the expenses – utilities, property taxes, repairs – can you afford to own a home?
Where location ranks on your list. Know going into the process how important location is to you. It’s about your lifestyle. A bargain isn’t really a bargain in a neighborhood you don’t really want to live in long-term. Are you willing to accept a smaller or older home in a great area where value will rise?
Working with a professional. Buyers now have access to do a considerable amount of research online, but a qualified buyer’s agent should be an expert on the neighborhood, recent sales, trends, and negotiating the terms of an offer.
The surrounding area. Sure, one block might be picturesque, but the entirety of the surrounding area will determine the value of a home. Explore the surrounding areas for schools, hospitals, fire stations, airports and train tracks that might alter your opinion. Also drive around at different times of the day to see if the vibe of the neighborhood changes a few blocks away.
Pay attention to taxes. Review the property taxes several months back and talk to your realtor about taxes. Know that a re-appraised home can lead to higher tax rates.
Talking to neighbors. The people who know most about what it’s like to live in a neighborhood, how well the sellers took care of a home, and underlying issues that might not be obvious, are the neighbors.
Do as much homework as you can on the property. Along with a comparative marketing analysis to spot area trends, get detailed records of home improvements. Ensure the title is “free and clear” so there are no problems with assuming ownership, and purchase homeowner’s insurance. Get everything in writing.
Getting a home inspection. No home is perfect, and a reputable home inspector will find out as much as possible about what is wrong with a house. Determine the real issues and what should be accounted for in your offer, as well as what might need future attention.