When you first start looking into buying a home, the amount of information out there can be overwhelming. While there is nothing quite like the having an experienced real estate agent to guide the home buying process, there are steps you can take on your own to prepare for your eventual first home purchase.
Check out these first-time home buyer tips to get started with your home search. By preparing early and thoroughly, you will gain valuable insight into the buying process and ensure that you are ready to put an offer in on a home as soon as you know it’s the one for you.
Start Preparing Early
Build up your credit for up to 6 months before a home purchase and don’t take on any new debt, credit cards, or loans that would impact your score. Save for a down payment. First time home buyers may not have to pay the standard 20% down, since there are many programs to reduce the initial down payment to assist in purchasing a home.
While you may only have to put 3-5% down payment on a house as a first-time homebuyer, it’s smart to have plenty of money saved to pay for the down payment, closing costs, taxes, and any other fees accrued during the purchase of a home.
One of the best first-time home buyer tips is to save as much as possible for a down payment, since many people underestimate the other costs associated with buying and maintaining home.
Do the Math
Decide how much home you can afford–not how much the bank thinks you can afford. Calculate monthly mortgage payments, and don’t forget about property taxes, the cost of potential home repairs, any furniture costs, home insurance, any HOA fees, and other costs.
It may not be possible to calculate the entire cost of purchasing a home at this point, but you can get close with mortgage calculators, realtors, and other resources.
Get an Inspection
The last thing you want is move into a new home and then find out you need to replace the roof, have structural damage, water or plumbing issues, mold, mildew or asbestos, or insect issues such as termites.
Each climate and geographic area will have its own housing risks that can be addressed with a home inspection. Inspections aren’t free, but they save a lot of potential costs down the road.
You may have to get several inspections on several different homes before you find the right one, but don’t skip this important step!
Too many people focus on finding the perfect home and neglect to research local neighborhoods. Even if you find the home of your dreams, if it’s in a neighborhood that doesn’t match your lifestyle or goals, you’ll likely regret the purchase.
The area that you buy a home will determine many things, from the amount of taxes you pay, any HOA fees required, the schools your children go to, area amenities such as parks, gyms, salons, beaches, and entertainment venues, and more.
Most people try to find a home close to work or in a certain location but talk to a local before getting you mind set on buying in one area. You might find that you like a different neighborhood better or that there are homes in a close by area that your family prefers.
Get Some Help
While you may have your ideal home perfectly pictured in your mind, finding the right home can be more difficult than you might think.
From scouring online listings to connecting with seller realtors and scheduling tours, there is a lot that goes into finding a home to buy–not to mention all the paperwork and negotiations that come after.
Most people need help purchasing a home, due to the documentation and negotiations required to complete a sale. In fact, 88% of buyers purchase their home through a real estate agent. Having a real estate agent ensures you get to see homes as soon as they hit the market and don’t risk losing out on a great house in the perfect location.
Search the Right Way
It may be easier to find homes for sale if you aren’t moving far from your current home, but for most people the home search starts online or via a real estate agent.
According to the most recent data from the National Association of Realtors (NAR), most home buyers either find the home they decide to purchase online (50%) or through a real estate agent (28%).
Even if you know which area you would like to buy a home in, it can still be difficult to keep track of recent home listings, schedule tours, and submit offers soon after a property becomes available, especially if you have a full-time job, children, pets, or other responsibilities to look after.
Think Long Term
Buying a home is an investment in your future, and most people can expect to stay in the first home they purchase for at least five years in order to recoup purchase costs, if not much longer.
Try to look for a home that will meet your needs now and those that may arise in the next five to ten years. Consider whether you will need more space in the next few years for a home office, a new hobby, children, pets, or space for guests.
When touring a home, keep an eye out for items that may need to be repaired or replaced in the next few years, since you are the one that will be footing the bill.
Negotiation is Key
Some markets may be in short supply of homes and leave buyers with less negotiating power, while others are a buyer’s market. One of the most difficult aspects of negotiation is knowing how much you can negotiate and whether you have to consider competition from other buyers.
Negotiating can do more than save you money on the listing price, it can also help you decide which costs will be handled by the seller and may lead to additional perks if you play your cards right.
Talk to your realtor to come up with a competitive offer for the market that you are in, that also gives you some room to breathe when it comes to paying the mortgage, closing costs, and any fees. Reasonable sellers will negotiate with you to come up with a fair final amount.
Get Started Finding Your First Home
Schedule a meeting with the Gulf Living Group to get started searching for your next home in the Florida Gulf area. Our team of local real estate experts help you navigate every aspect of buying a home for the first time.