Are you thinking about purchasing your first home? Embarking on this major milestone can be an exciting time filled with anticipation. There’s a lot to consider before you get started, from finding a mortgage lender to wrapping your head around home inspections to deciding if you’re willing to take on a fixer-upper. The following tips can help you get a handle on the process and navigate the world of home ownership.
Get clear on your budget
Preparing your finances and calculating your overall budget is one of the most important steps you’ll take as a prospective homeowner. What monthly payment can you reasonably afford and what home price does this correspond to? In building your budget, you’ll also want to consider everything from your down payment and closing costs to the price of moving and annual property taxes. It’s also important to factor in everyday expenses such as home maintenance bills, utilities, upkeep, repairs, and smaller renovation projects. Most importantly, be honest with yourself about what you can afford; it will make the whole process easier from the get-go.
Narrow down potential neighborhoods
The location of your home will impact your day-to-day life. Are you looking for a place in a more urban or suburban area? Do you mind a longer commute to work? Does being in a certain school district trump everything else? Which areas have listings in your potential price range? Choosing a few specific neighborhoods to focus on will make your search more manageable.
Make a list of your wants and needs
When thinking about your future home, it’s important to differentiate between your wants and needs. For example, buying a one-story house without stairs may be a non-negotiable, while having a new chef’s kitchen would be an added bonus. Consider your lifestyle and what you like and dislike about your current living situation, and be open to compromising on some of your “wants” along the way.
Consider repairs and modifications
While professional designers make it look easy on TV, renovating and repairing a home is no joke. Ask yourself if you would enjoy tackling that kind of project. If yes, can you find a better home within your budget if you commit to fixing it yourself, or will the house require a more extensive overhaul? If no, look for a place that is move-in ready or requires minimal work. Answering these questions can ensure you don’t overextend yourself (or your budget).
Find the right real estate agent
The right real estate agent will help you navigate the entire process and offer support and know-how along the way. Ask around for trusted recommendations, look online for agents in your area with great reviews, and meet a few candidates in person to see who can best serve your needs.
Protect your purchase
Spend some time thinking through how you will protect your purchase once you’ve made the leap into home ownership. For example, is it time to get a life insurance policy to ensure your family can continue paying the mortgage even if you pass away? Many new homeowners get a term life insurance policy that covers them for the length of the mortgage. Whatever you choose, it’s important to take steps to safeguard your new home for many years to come.
