Though it sounds relatively simple, a lot of work and consideration goes into finding your first home. You'll need to think about what you need, want and can afford in a home - all of which take time and planning.
Before you start, though, it's important that you develop the right mindset. Since this is your first time buying, it's unlikely that you'll stumble upon a "perfect" home. Sometimes, the idea of perfection in real estate is risky, because it could cause you to overlook a home with great potential. That potential is what finding a home is all about, especially when you're embarking on homeownership for the first time.
You may decide to add to and improve this property in the years you live there, or use the money from selling it to find an even better home later on. Either way, this choice is an investment in your future. Keep your dreams in mind, but don't let them hold you back from discovering a great home.
Establishing a Budget
No one should start a house hunt without knowing how much they can realistically and comfortably spend. Skipping the step of setting a budget leads to wasted time and the disappointment of unrealistic expectations, especially when it’s a prospective buyer’s first shopping experience. A lender’s pre-qualification gives shoppers an estimate of the limits of their borrowing ability, but there are other factors involved. Buyers also need to think about how much of their income they want to apply to non-housing purposes, like savings or other major purchases. Using a home affordability calculator
can make setting a budget easier.
For some hopeful buyers, the numbers may not align with what they want in a home. If they have their hearts set on something they cannot yet afford, the best next step may be to rent a bit longer
and save more money for their down payment.
Making the Big Decision
Home buyers have a lot of things to consider when deciding if a home is right for them
or not. Once the price is right, size, location and lifestyle are the most important considerations.
- Size: It’s important for buyers to decide how much space they need, including the desired number of bedrooms and bathrooms as well as overall square footage.
- Location: When a family includes children, finding the best school district might be the priority. Choosing the right location can also involve considering factors such as noise levels, traffic patterns, crime statistics, nearby amenities, and even community spirit.
- Lifestyle: The right space is the space that fits a family’s lifestyle best. For example, spectacular views mean nothing if no one is home long enough to enjoy them, and a minimalist kitchen may be beautiful but completely dysfunctional for a large family.
First-time home buying can be a very emotional journey. It’s also important for shoppers to be aware of common red flags, such as:
- A beautiful neighborhood with a high crime rate
- Abandoned properties in the vicinity
- Large tracts of undeveloped land nearby
- Signs of potentially major damage in the home
Any of these can mean trouble in the future, from unexpected expenses or loss of home value to the aggravations of a large construction site within earshot.