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 home buyer. 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 home buyer 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 understand of what you want versus what you really need in a home, you will be 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 home ownership. 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 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 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, plus drive at different times of 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, and 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 that there are no problems with assuming ownership, and purchase homeowner’s insurance. Get everything in writing.