Tips for First-Time Homebuyers
That exciting day has finally come: you are ready to buy your first home. Before you leap through the front the door and start painting murals, make sure you have done all your homework and, number one, that you have correctly ascertained what you can really afford. Here are some tips for first-time homebuyers, including the benefits this opportunity gives you and guidelines on the best way to go about the process.
Reasons for Home Ownership
If the thought of home purchase makes you feel pressured, overwhelmed, or just out and out stressed, you are not alone. Your first home is one of the most major purchases and investments you will make in your life. Take a deep breath and remember why purchasing a home is a solid choice:
- Stability and Pride: Though buying a home might make you feel like you are forever bound, your home actually allows you a lot of freedoms you cannot have while you are renting. When you own your home, there is no one to ask permission for any walls you want painted, cabinets you want removed, or tiles you want replaced. Your home is yours to make as you want, as you are comfortable in; your oasis. It’s the place where you will have friends and family visit and socialize; where you may raise your children or even where you may work. It’s the place where every night ends, and where every new day begins.
- Value: Overtime, historically, real estate only appreciates in value. The longer you stay in your home, the more equity you can accrue. Many financial experts regard home or property purchase as a healthy guard against inflation.
- Home Equity: As you build equity in your new home, there are many home equity loans and line of credit products available to use against it, at a much lower interest rate than standard loans, credit cards, or other credit lines.
How Much You Should Shop Around
The length of time you spend shopping for your first home will depend mainly on two factors: your level of motivation and/or need, and the current market. In a seller’s market, you won’t have the luxury of shopping around as much as you would in a buyer’s market. You may have to put in an offer right way to ensure you are considered for the home you want, and sellers can afford to dismiss offers as they will most likely receive more than the one they need. Some real estate agents say that motivated buyers, who know what they want, find a home within two weeks. This is really up to you. If you have children starting school soon or employment that begins at a set date in a new city, you may be on a tight timeline to acquire your home. If you are leisurely looking in a buyer’s market, you could take months.
You probably do not want to see more than a maximum of seven homes in a day. Any more than this and you will be over-exposed, and won’t remember clearly the draws or drawbacks of any of them. It is recommended that you view homes when you are well rested and well fed, as you would before exercising or taking an exam. Take notes and take pictures. Bring with you your digital camera so that you can take pictures of the features you like, or didn’t like, in each viewing that you want to consider or reflect more on later. Examine the home’s surroundings, the yard, amenities in the neighborhood, proximity to busy streets or parks, etc.
Utilize a Professional
For your first home purchase, it will most likely be of beneficial use for you to employ a reputable expert in your hunt for your optimal home. Real estate agents know what to ask, can point out features or flaws that you would not see, or ask questions that you would not think to ask. Real estate agents have much more experience in home shopping than you do. So long as you select someone you trust, and someone who specializes in homes in your price range and in the areas you are interested in living, you should find their help an asset.
Ensure that you have your real estate agent do their research on the properties they show you. Are their schools nearby? Malls or stores? Has the neighborhood been known to have environmental hazards or higher than normal crime rates?
When you have narrowed down your search to two or three properties, revisit them again. With a fresh view, you should be able to make a firm, secure decision on the property that is right for you, and that meets all your objectives of homeownership.
Get Pre-Approved for a Mortgage
One thing that will definitely save you time and narrow your search, is a mortgage preapproval. Being preapproved ensures you know exactly what will fit in your budget, and communicates to the seller that you are a serious buyer with your finances in line. A mortgage preapproval will reduce the scope of homes you are looking at, and expedite a seller’s consideration of the offer you make.
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