4 Things First-Time Buyers Should Always Do
Buying your first home is exciting and it is easy to become focused on the surface details. While those things matter, there are important things you must remember to factor into your buying decision.
Here is a checklist of important, and sometimes less obvious, things to do before you decide to buy:
Factor in the home’s potential resale value
You never know what the future holds. Buying is a great investment and can even save you money versus renting. But will you be in this home 5 years from now? The fact is, you could be settling into this home for many years or just a few. You should consider whether it will be easy to resell this home. Look at the home through the eyes of a seller:
- Does it have broad appeal or is it taste specific and quirky?
- Is the school system good and the area in demand with buyers?
- Ask your REALTOR about the selling trends in the neighborhood and whether they think your home would sell for the same amount two years, five years, or maybe even 10 years down the road.
Research the neighborhood
The house itself may be ideal, but not if the neighborhood lacks the qualities that make you feel “at home”. Visit the neighborhood at different times of day, and even on a weekend. The noise level may change and you may find neighbors behave differently on a Saturday night versus a Tuesday morning. Also investigate:
- Crime rates
- Traffic patterns
- Any new construction or changes planned for the area
Consider the real costs after you buy
Most buyers are focused on mortgage payments and those closing costs, but they forget what it takes to maintain a home. Here are a few regular expenses to factor into your budget:
- Heating oil or propane
- Lawn care/landscaping
- Snow removal/plowing
- Any homeowners’ association fees (if the home is part of a HOA)
- Maintenance or repair of furnace (cleaning and servicing), septic (if private), HVAC, appliances, etc.
To make sure the bottom line will be within your means, ask the seller for a property expense list to get an idea of what you will actually be paying out each month. Then, consider the reserve that you'll need for typical maintenance. Plan on setting aside 1% of the home's total value annually for upkeep and repairs.
Learn all the regulations and expectations of the Homeowners’ Association
If applicable, you’ll need to fully understand the cost and the expectations of the homeowners’ association. While HOAs are often a great way to be a part of a community—working together to keep the neighborhood in great condition and well cared for—some have been known to be a thorn in a homeowners’ side.
- What is the monthly cost?
- Can that fee go up and how often has it done so in the last 5 years?
- What are the rules about the appearance of my property (lawn care, building additions, paint color, sheds, trash cans, the number of vehicles you can own, even your mailbox.) Get all the specific rules and read them. Some HOA have basic rules, while others dictate small details that you might not think are logical.
Buying your first home can be one of the most exciting purchases of your life. You will remember it forever. But it takes finding a great REALTOR to advise you and your own research—and looking into all the details —to make the best buying decision.
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