10 Tips from Real Estate Pros for Buying Your First Home
Get Your Financial Ducks in Order
A home will probably be one of the biggest purchases in your life, and you’ll be making monthly payments for the next 30 years, so realtor Alexei Morgado recommends upgrading your financial profile before you even start house hunting. He suggests doing the following:
- Find out where your credit stands, and if it’s less than ideal, look for ways to improve it.
- Pay down as much outstanding debt as you can.
- Look for down-payment assistance. “Most first-time buyers are eligible for some form of program in their state or locality and do not take advantage of it.”
- Look into financial assistance programs for first-time home buyers.
Get Pre-Approved for a Loan
If you’re just starting to look for a house, real estate agent Eli Pasternak identifies pre-approval as an absolute necessity. “I see buyers fall in love with properties they can’t afford and waste months chasing unrealistic dreams.”
By sticking to your budget, you’ll avoid disappointment by confining your search to properties within your budget, but Pasternak recommends even going below budget: “I think that buying below your maximum budget matters way more than getting the biggest house possible because unexpected costs hit hard in the first year.”
Choose a Good Spot
You’ve heard the adage: “Location, location, location,” and there’s a reason. “Location beats house features every time,” says Pasternak. “You can change paint colors, but you cannot change bad schools or long commutes.” You also have no control over climate patterns, like frequent high winds, droughts and heavy snow, that can make living in a particular spot troublesome.
Pasternak suggests that people drive through neighborhoods at different times to see traffic patterns and noise levels. In addition, it’s a good idea to talk to neighbors to see how they like living there.
Understand Your Insurance Options
Your lender will require insurance, but policies aren’t all the same. “A standard policy typically covers the structure of your home, personal belongings and liability, but certain risks like floods and earthquakes require separate coverage,” advises insurance agent Peter Piotrowski.
“Not all home features are covered. Many first-time homebuyers assume that features like swimming pools or detached structures are automatically included in their policy. However, these often require separate endorsements or additional coverage. It’s important to evaluate your home’s location and check with your insurance agent or provider about its potential risks to ensure you have the right protection.”
With the recent increase in catastrophic wildfires, some insurance providers may charge exorbitant rates or limit coverage for fire damage in some areas. That makes it doubly important to shop around and ask lots of questions.
Take Inspections Seriously
At first glance, it may be your dream home, but it can quickly turn into a nightmare if you rush the inspection and fail to address major issues before closing. “With mortgage interest rates at 6.5% and low inventory, be deliberate and do not rush anything,” advises Morgado. “Negotiate credits for closing and repairs, and do not under any circumstances waive the home inspection.”
This is one of the most important buying first home tips. You’ll have plenty on your hands when you move in without having to worry about a major problem you could have discovered before you assumed responsibility for the property.
Budget for Extra Expenses
Mallorca realtor My Reiderstad advises: “Factor in 10–13% on top of the purchase price for transfer tax or VAT, notary fees, registry fees, legal bills, insurance and inspections.” Of course, if you’re buying a home in North America, you won’t have to worry about transfer tax or VAT, but you will have to pay property taxes, and they can be considerable.
The taxes on my house in California add about $1,000 on to the monthly mortgage payment. In addition, we pay for trash services, utilities and local road maintenance. On top of that, add property maintenance. Ka-ching!
Make Sure No Pending Payments Are Due
You don’t want to move in only to find the previous owner hasn’t paid the utilities for several months or still owes a contractor for work already completed. Having the electricity suddenly switched off or a lien placed on your property is no way to spend the first few months in your new home.
You can usually depend on your agent to take care of these details, but if you’re working on your own, this is one of those buying first home tips that you need to prioritize.
Plan Renovations
Very few homes are truly turnkey. After you and the seller have hashed out the details of necessary repairs revealed by the inspection, you’ll probably want to make more improvements to suit your lifestyle. They could include:
- new flooring;
- updated appliances;
- electrical upgrades;
- new paint.
You may want to complete some of these renovations before you move in, especially if you’re replacing flooring or repainting the interior. If so, do yourself a favor and have contractors accompany you during the inspections, so you can get estimates and plan your budget.
Think Long-Term
“Life changes even if it is your ‘forever home’,” says Daniel Cabrera, who buys distressed homes in Texas. You may get a job in a different city, a family issue may force you to move, or you may just decide you want to move for different reasons.
If you have to sell, you want to get the best price, and that means being prepared to address issues that are likely to arise—particularly safety and code issues—that could lower the resale value. “Think roofs, heating/cooling systems and appliances, which all deteriorate over time. Budget for replacements.”
You may also want to add features, like a deck or garage, to make the property more desirable. Factor in the potential costs before you make an offer.
Gather Essential Items for Move-In Day
Pasternak has this advice: “I tell new homeowners to buy a good toolbox, fire extinguisher and basic cleaning supplies before move-in day. You’ll need a plunger immediately, trust me on that one.” The other things you’ll need to include are some or all of the items on this list:
- Basic furniture (unless you like sitting on the floor);
- Trash cans;
- Bedding and towels;
- Toiletries;
- Basic kitchen supplies.
Don’t forget the small stuff, like batteries for smoke alarms, a hex wrench for clearing the garbage disposal and house keys that fit the locks. “We get calls all the time that keys don’t work,” says broker Jeff Lichtenstein.
About the Experts
- Eli Pasternak is a licensed Florida real estate agent, an experienced investor and the Founder of Liberty House Buying Group.
- Jeff Lichtenstein became a real estate agent in 2000. Today he is the owner and broker of Echo Fine Properties, a luxury residential brokerage, based in Palm Beach Gardens, Florida.
- Peter Piotrowski is Chief Claims Officer at Hippo, the home insurance group focused on proactive home protection.
- Daniel Cabrera is the Founder of both Sell My House Fast SA TX and Fire Damage House Buyer. He has dedicated over a decade to assisting homeowners nationwide in navigating the complexities of selling their properties.
- Alexei Morgado is a licensed real estate agent and Realtor based in Florida. He’s the founder of Lexawise, a preparation platform dedicated to helping new agents and brokers ace their licensing exams.
- My Reiderstad is the CEO and Project Manager of Reiderstad Invest, a premier real estate agency established in 2012, with offices in Mallorca and Crans-Montana.
The post 10 Tips from Real Estate Pros for Buying Your First Home appeared first on Family Handyman.
For top-notch cleaning services, look no further than mj cleaning services, where quality and customer satisfaction are our top priorities. Whether you're in need of a one-time cleaning or ongoing maintenance, m j cleaning services offers a wide range of options to suit your requirements. With a reputation for excellence, m.j. cleaning services delivers professional and reliable cleaning solutions to ensure your home or office stays pristine and welcoming.
No comments