First Time Home Buyers Tips And Advice On Home Purchase
This BLOG On First Time Home Buyers Tips And Advice On Home Purchase Was UPDATED On May 12th, 2019
Once homebuyers have decided they want to be a homeowner, they should consider several factors before shopping for a new home. We will offer First Time Home Buyers Tips And Advice on this blog:
- Many first time home buyers may have dozens, if not hundreds, of questions
- Many seek advice First Time Home Buyers Tips And Advice from family members, friends, and relatives who are currently homeowners
- There are hundreds of First Time Home Buyers Tips And Advice articles on the internet as well as home buying guides
- Home ownership comes with responsibility
- Home ownership is a long term commitment
- Most buyers who purchase a home stay in their new home purchase for at least five or more years
- If buyers are planning on moving constantly, maybe home ownership may not be the best interest
- Re-sale of a home should be considered
- Purchasing a home today and selling in a year it may not be the best investment unless the property has appreciated substantially
- First and foremost, need to list home with a real estate agent
- Realtor’s commission will be 6% of the sales price
- There are moving expenses and closing costs on any home buying and sales transactions
Consider Long Term When Buying A Home
Young couples who recently got married and are planning on buying a new home, consider the long term. First Time Home Buyers Tips And Advice includes:
- Consider having kids in the near future?
- Planning on having pets?
- Large dogs?
- Will large fenced yard will be necessary?
- Will in-laws or family members be visiting for extended visits?
These are considerations future homeowners should have in mind before shopping for a home.
- Maybe a four bedroom home will make more sense than a 2 or 3 bedrooms home
- I have seen many first time home buyers who purchased a two bedroom home and needed to sell their home to purchase a four bedroom home
- This is because they had to accommodate their elderly parents
- By planning home purchase, homeowners will avoid moving again and save thousands of dollars
Re-Sale Of Property In Future
Always think about the future resale of the property.
- There are many homes that are unique where it will accommodate needs
- However, it will not accommodate the needs of other potential home buyers
- For example, a home buyer might be a car enthusiast
- The home interested in buying may have a six car garage
- The home itself may have only a 3 bedroom 2,000 square feet home
- The six car garage may be a major benefit for the new homeowner
- But how many homeowners need a six car garage
- Also, do not want to have a white elephant where the house is the biggest home in the area
- Having a 5,000 square feet home where most of the neighbors have homes that are 3,000 square feet is normally not a wise investment
- Do not want to have the largest home in the block because it will be difficult to sell later
Make Check List On Important Items
First time home buyers and seasoned home buyers should make a check list on an item that is important.
- For example here are First Time Home Buyers Tips And Advice considerations:
- attached garage versus detached garage
- the master bathroom in the master bedroom
- full basement whether finished or unfinished
- eating area
- number of bedrooms and bathrooms
- master bedroom on the first floor versus second for elderly homeowners
- other amenities that you would like
- Chances are that not every home will have the amenities that will suit the homeowner
- Can take the check list with on every home visit and weigh the pros and cons
- The home with the most wants on the check list may be the home
- Weigh the pros and cons
Analyze Total Housing And Associated Expenses
PITI, principal, interest, taxes, and insurance is not the only housing expenses that should be considered:
- There are other expenses associated with each particular home depending on the location
- Property taxes are the biggest factor
- One county’s property taxes on a home may be $3,000 while the adjoining county property taxes on a similar and like property may be $12,000
- Same with homeowners insurance
- Homeowners insurance can vary from county to county or city to city
- Utilities are another cost that has variable rates depending on location
- Another major expense is commuting expenses
- How far is home from work?
- What are the travel times and traffic during the drive to and from work
- Need to pay tolls?
- Tolls can cost a lot
- Many times a commuter pays multiple tolls to get to work
- All these are considerations are First Time Home Buyers Tips And Advice
Some homes are part of a homeowners association.
- Homeowners associations charge a fee and are somewhat like property tax
- Need to pay a homeowners association fee if the home is part of a homeowners association
- If homeowners do not abide by the homeowners association by-laws, HOA can take legal proceedings against them
- They can even foreclose on your property
- Find out whether or not they will allow homeowners to rent property in the event to keep the property as a rental in the future
- If intending on doing a major remodel on home in the future, need to have the homeowners’ associations approval
- Check with the homeowner association and get the list of their rules and by-laws
Thoroughly Review Real Estate Purchase Contract
Always ask for a sellers concession from the home seller where you do not have to pay closing costs.
- The Realtor will help home buyers with negotiations and sellers concessions
- Thoroughly review the real estate purchase contract
- Make sure to be protected with contingencies
- Buyers should have the following contingencies:
- financing contingency
- home inspection contingency
- appraisal contingency among many others
- Contingencies are extremely important
- It is the contingency that will give home buyers the right to cancel the real estate purchase contract and get earnest money back
Study Demographics Of Neighborhood
First time home buyers should thoroughly study the demographics of the neighborhood they are buying their home. How far is public transportation? How far is shopping centers? How far is the tollway from your home? What type of people lives in the neighborhood? Single people? Families with kids? Seniors? Students? What is the percentage of homeowners in your neighborhood? Are there apartment complexes nearby where there is public housing?
Not all lenders will require reserves. However, every homeowner should have reserves in the event if something goes wrong. As a homeowner, there will no longer have the luxury of calling the landlord when the furnace or air conditioning unit breaks down or if appliances don’t work. Some of these repairs can cost several thousands of dollars.