Ready to take the leap and buy your first home? Searching for your dream house can be an exciting—and trying—experience. Here are a few suggestions to make house hunting easier and help you get into your new home sooner!
1. Make a plan. What do you want and need from your first home? Take a moment to write it down. This is especially important if you’re shopping with a partner or spouse. You’ll save a time and aggravation if you agree on what’s most important in your house before you hit the streets shopping. Is it all about the location? Do you want an impeccably-kept modern home or would you consider a fixer-upper? The more factors you identify as important early-on, the faster you’ll be able to hone in on properties that meet your needs.
2. Set a budget. This goes hand in hand with tip number one. How much house can you afford? If you’re not sure, I’ve written on this subject in How Much House Can You Afford and What Percentage of Your Income can You Afford on Mortgage Payments? Do you want to stretch and buy more home than you need so you can grow into it, or do you hope to pay off your mortgage quickly by buying a home you can afford with a 15-year fixed mortgage?
Ultimately, your income, savings, and local real estate market will determine your viable housing budget. Once you set it, commit to it. Your real estate agent will inevitably show you properties that exceed your budget “just for comparison”. You need to prepare to be firm and stick with a house you can afford.
3. Get mortgage pre-approval. You don’t want to find your dream home only to let it slip through your fingers because you can’t qualify for a mortgage at the last minute. Getting mortgage pre-approval is a vital first step in the home buying process because it gives you an idea of what mortgages you can qualify for and how much they will cost, plus it lets sellers know that you’re serious about buying so they will be more likely to take your offer. Learn more about getting competing mortgage quotes online.
4. Consider the location. There’s a reason for that old line “location, location, location.” Where you buy your first home will not only determine how much you pay, but the location will also shape your life for as long as you live in the home. Will you be having kids in this home? How are the schools? What will your commute be like? If you change jobs, what is the employment market like within commuting distance from the location? Before you start looking at properties, focus only on areas where you could see yourself living for years to come.
5. Do some research. Thanks to the Internet, home buyers today no longer need to rely on their realtors to suggest listings to look at. You can start searching available properties and real estate values in your target areas from the comfort of your own home.
6. Create your own house hunting checklist. Once you start touring properties with a real estate agent, house hunting can be fast and furious. You’ll see so many properties you won’t be able to keep them straight, and there will often be pressure from sellers and their agents to make a quick offer. Create a checklist that you can use for each property you view. Include your criteria and include a space for notes. This way, at the end of the day, you can take your checklists home and compare properties easily.
7. Find a buyer’s real estate agent you trust. You don’t have to work with a buyer’s real estate agent; you can simply visit listings yourself and deal directly with the seller’s agent. First-time buyers, however, are probably wise to enlist a buyer’s agent. (Usually, having a buyer’s agent on your side won’t increase the commission you pay, it will be split with the seller’s agent. But be sure to ask how your agent is paid, anyway).
Ask friends and family for recommendations for real estate agents they’ve worked with. If that won’t work, call a few local agencies and ask to set up “interviews” with a few prospective agents. Explain to the agents that you’re shopping around, and choose an agent you’re comfortable with and that seems to be knowledgeable about the market and price-level in which you’re shopping.
8. Get comfortable and relaxed. Prepare for all-day house hunting sessions by dressing comfortably and bringing water and snacks. You never know how many properties your agent may want to show you or how long you’ll have to wait for a seller’s agent to let you into a property. Be ready!
9. Be prepared make an offer. A lot of people shop for houses before their truly ready to buy a home. Maybe the timing isn’t right yet, maybe they don’t have enough saved up for a down payment, or maybe their credit needs work. Before you go out house hunting, ask yourself: Could you buy a house today? Using this gut-check will save you a lot of agony (and possibly money) if you make an offer but don’t close because, for one reason or another, you weren’t ready.
10. Have fun! Buying your first home is a major milestone and has the potential to be a lot of fun! Just remember to relax and take things one step at a time. Everything may not go perfectly smoothly, but if you’re committed to buying a home and are working with a reliable agent, you’ll eventually find yourself in an awesome new pad!