Buying your first home is equally exciting and stressful. You’re preparing to make one of the biggest steps in your adult life, so it’s only fair to assume you want it to go as planned. When you start house-hunting and going to showings, you should keep several things that could affect your decision in mind. If you’d like to learn some of the crucial factors to consider as a first-time homebuyer, we’ve got you covered. Read our list below to learn more.
Consider All the Expenses
Before you even begin looking at homes, you must consider your current financial situation. Analyze your bank accounts, debt, and spending habits. You should have an emergency fund of three to six months’ worth of expenses saved up before you consider buying a home. Once you’ve inspected your finances, you should find out what you’re preapproved for in terms of a mortgage. A lender or bank will review your credit score, income, and debt and give you a number. In general, it’s a good idea to look at homes below your preapproved number; otherwise, you may end up “house poor.” A lot of first-timers don’t realize the number of expenses involved in buying a house. You’re going to have closing fees, attorney fees, state and local taxes, and plenty more—all good reasons not to max out your preapproval number.
Do Your Research About the Area
Everyone buys a home with different goals in mind; some homeowners want to live in their homes for a couple of years until they can upgrade and move elsewhere. Alternatively, some people want to move into homes with the plan of raising families and living there for decades. Either way, you should research the safety and crime levels in the area. If you’re planning on raising a family in that home, you’ll also want to research the schools in the area.
Always Ask for Comps
Comps are crucial for helping you identify a good price from a bad one and for supporting you when it comes to negotiation. If you’re not familiar with comps, they essentially tell you the prices for which similar homes in the area have sold. Essentially, you need comps to ensure you’re getting a fair price, among other reasons. If you’re working with a real estate agent, they should provide comps, but it’s your responsibility to ask for them if they don’t.
Buying a home is not an easy feat. It can be a long, grueling process, especially when it’s your first home. We hope providing these crucial factors to consider as a first-time homebuyer eliminates the surprises and helps you find you’re forever home at a fair price.