As we close out a summer marked by rising home prices and limited supply, we’re conditioned to expect the inevitable end-of-season slowdown. But the change of season doesn’t
First Time Home Buyer Mistakes You Can Avoid
First Time Homebuyer Mistakes You Can Avoid
You’ve been thinking about it for years. You’ve been saving and saving and planning and planning – often with a spouse and a family behind you – and the moment is here. You’re ready to buy your first home. Congratulations!
Now the bad news: you’ve still got more planning to do. Buying a home is a very complex process that – when approached incorrectly – can have unpleasant results down the line. First time homebuyers make a few common mistakes that can be avoided with adequate preparation. Hopefully our guide can help!
Only Looking at the Mortgage Payment
Stop me if you’ve heard this before: a car salesman says you can get a brand new car for only $250 per month! That monthly payment fits nicely into your budget, right? Of course, he isn’t so enthusiastic when disclosing the higher interest rate and higher price on the car, meaning you pay more in the long run. Homes are rarely marketed as aggressively as cars, but the principle remains the same: for your price range, think long-term.
Underestimating Ownership Costs
Speaking of monthly payments, there are some recurring monthly charges you might not think about. Homeowners insurance, HOA fees, taxes, and more are unique to home ownership. You’ll also pay higher utilities than for a small apartment, and there’s no landlord to fix your stuff anymore! Repairs in particular can be a nightmare, especially if you drained your savings to afford a down payment. Double and triple check all expenses with your agent, and make sure you have extra set aside for repairs.
Idealizing Buying vs. Renting
Owning a home can be a great source of financial stability. But depending on your market, it’s not always the best bet; in markets like NYC or San Francisco, stratospheric prices can shut most folks out. You should also consider your place in life. Do you expect to change jobs soon? Do you have time for lawn maintenance? Will you want to move for any reason? Renting can not only be more convenient, but may end up saving you money if you’re not ready to settle down.
Compromising in the Wrong Areas
You can change ugly wallpaper. You can repair a weak deck, put up a new fence, and repaint a front door (pink? What were they thinking?) But adding bedrooms, expanding bathrooms or building up a tiny kitchen are jobs best left to the professionals, and for many people they can be financially impossible. So compromise on aesthetics if you have to, but do not compromise on the essentials. You’ll regret that a lot more than shag carpeting.
Ready to buy your first home? We can help you find your perfect match! Contact Domicile Realty today and let’s get started.
A native of New Jersey, Kristine attended Rowan University with a major in Early Childhood Education. After teaching kindergarten for one year, she discovered her passion for real estate and subsequen....
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