Buying a home is one of the most significant investments that someone can make in their lifetime. If you’re a first-time homebuyer, the process can be overwhelming. However, with the right information and guidance, you’ll be able to reduce this stress and confidently navigate the path to finding your dream home. Ready to start your journey? Let’s explore 10 home buying tips that will lead you to a successful closing day.
10 Home Buying Tips Every First-Time Homebuyer Should Follow
1. Determine Your Budget
Before you start shopping for a home, it is essential to determine your budget. This will help you narrow down your search and avoid wasting time looking at homes out of your price range. You can determine your budget by calculating your monthly income, expenses, and debts. You should also factor in the down payment— the National Association of Realtors lists 8% as the median down payment for homebuyers aged 23-31—closing costs, and other expenses associated with purchasing a home.
2. Understand Your Needs vs Wants
We’re not always honest with ourselves when it comes to what we need vs want in a home. Think through your priorities before looking at your options. What do you absolutely need? Maybe it’s extra bedrooms because you plan on having children, or a yard space for your dog to safely play in. Then, think about what would be nice to have in addition afterwards. It’s possible to get the best of both worlds, but establishing the difference between these two factors will help you find a home that realistically meets your criteria.
3. Get Pre-Approved for a Mortgage
Getting pre-approved for a mortgage makes the home buying process smoother. It will give you a clearer picture of how much you can afford as well as establish you as a serious buyer. According to Forbes Advisor, “Many real estate professionals won’t take on buyer clients if they haven’t already been pre-approved.” Thus, pre-approval is an important step and stepping-stone into the next part of the home buying process.
4. Find a Real Estate Agent
A real estate agent can help you navigate the home buying process and find the right home for your needs and budget. They can also provide you with valuable information about the local housing market, schools, and other amenities in the area. Remember, you can’t rely on the seller’s real estate agent to have your interests at heart. When choosing a real estate agent, make sure to do your research and find someone who is knowledgeable about the area you’re looking at.
5. Research the Neighborhood
When buying a home, research the neighborhood to ensure that it’s a good fit for you and your family. Consider factors such as the crime rate, schools, public transportation, and proximity to grocery stores and restaurants. You can also talk to neighbors and visit the area at different times of the day to get a better sense of what it’s like to live there.
6. Attend Open House Tours
Attending open house tours is an excellent way to get a feel for different homes. It will also give you an opportunity to ask questions and learn more about the homes you are interested in. When you go, make sure to take notes and ask the real estate agent any questions you may have.
7. Get a Home Inspection
No one wants to buy a home only to be caught by a nasty surprise. Getting a home inspection will help you identify any potential issues with the home before you make an offer. A home inspection can also give you leverage during price negotiations.
8. Negotiate the Price
Once you have found a home, it’s time to negotiate the price. Your real estate agent can help you with this process and ensure that you get the best deal possible. When negotiating price, consider factors such as the home’s condition, local housing market, and the seller’s motivation to sell. Try not to go over your budget if you must be competitive in your offer. You may love the home, but extending past your reach causes unwanted financial difficulties down the line.
9. Buy Homeowner’s and Title Insurance
These two things are must-haves if you want to protect your home from unforeseen issues. Your homeowner’s insurance is required by the lender and will pay for things that happen during ownership, such as repairing or rebuilding your house after a disaster. Title insurance protects you from things that happened before buying the property, such as failed property tax payments by the previous owner.
10. Close the Deal
Once you have agreed on the terms of the sale, it’s time to close the deal. This involves signing a contract and paying the down payment and closing costs. Carefully read through all the paperwork before signing to ensure you don’t agree to anything you aren’t aware of. Remember that your real estate agent can help explain any questions you may have during this process. At Millennial Title we make it easy to see the progress of the closing process with the Millennial Tracker.
One Extra Tip: Enjoy Your New Home!
Using these 10 home buying tips, you’ll be well on your way to finding the perfect place to call yours. At Millennial Title, we’re here to support you through every step of the home buying journey, even the steps that come after closing. Continue your path to success by learning the dos and don’ts of what to do after closing.