Obviously, first-time home buyers don't have experience on their side. Even if they have friends or family members who are real estate agents or investors, they haven't experienced the process themselves. Here are tips to help first-time home owners tackle the process with finesse and savvy while purchasing a home that really fits them.
Be realistic about what you want.
Before you actually start looking, determine what's really important to you. Would you like a 2-car garage, a large, eat-in kitchen, office space for 2, a master bedroom suite on the main floor, a level yard, ceiling fans in every room, no carpets, and a bonus room above the garage, all in a starter home that qualifies for a USDA mortgage? Wonderful!
Realize, though, that limiting your search to homes that meet all those criteria will drastically reduce your options and increase your search time, especially during a housing shortage like the one we've experienced lately.
Savvy first-time home buyers think through what's really important to them and generally focus on a handful or so of critical features.
Know what you can afford.
Touring homes before you know what you can afford is like actually looking for a needle in a haystack--almost certain to be a disappointing experience.
Don't set yourself up for that disappointment. Talk to a lender--or 2 or 3. Check out a few online lenders. Find out how much these lenders are willing to lend you. While you're connecting with them, see if they offer any special programs for 1st-time home buyers. Many do. See if you do now--or could shortly--meet those requirements.
Even if you're a cash buyer, you'll want to consider cost factors such as initial repairs or improvements, closing costs, and HOA fees--especially for townhome or condo purchases with substantial monthly fees.
Be ready to make a decision.
No, I'm not encouraging a hasty decision that's ill-advised and could be disastrous. However, until very recently, the housing market seriously favored home sellers. Most homes were under contract in a few days. Some went under contract in a few hours.
Indecisive buyers, or buyers who wanted to carefully examine every detail of the house before submitting an offer, usually didn't get the opportunity to submit their offer. The home was under contract before they got to that point.
The housing market has started to shift in the past few months. However, the lower-priced segments that feature starter homes attractive to most 1st-time buyers are still quite competitive, at least in our greater-Greenville market.
Savvy 1st-time home buyers are ready to make a decision when they see a home that checks all their critical boxes.
Ask questions.
In addition to being the single biggest purchase most people make, buying a home involves several people and lots of legal documents. There are many moving pieces and enough real estate vocabulary to make things confusing.
For example, what's the difference between being "pre-qualified" by a lender and being "pre-approved?" What expenses make up closing costs? How do FHA, VA, and USDA loans differ? What's a contract contingency? What's an "As-Is" contract, and should you ever consider one?
You'll need someone you can trust to answer those questions--and others that arise. You'll do yourself a favor if you work with an experienced Realtor® who can answer many of your questions and refer you to your lender or someone else who is knowledgeable for questions regarding financing or legal concerns. Squelching your questions can be financially and emotionally costly.
Be persistent.
Only once in over 7 years as Realtors® have we had clients place a successful offer on the first home we showed them. Usually, finding the very best home involves a process that includes seeing several homes and making more than one offer before having a ratified contract.
This can be discouraging. However, savvy first-time home buyers know the value of being persistent. They trust the process and know that persistence will, indeed, pay off.
Key Takeaways
Savvy first-time home buyers:
Are realistic.
Know what they can afford.
Are ready to make a decision.
Ask questions.
Are persistent.
Are you a 1st-time home buyer who's confused about the process? Do you need someone to guide you through the search and help you make a strong offer that fits your budget? Are you a repeat buyer (or seller) who wants a trustworthy agent to facilitate the process?
Contact us at mickwalker@kw.com or sandywalker@kw.com. We'd love to help you.