I remember my first house purchase (like it was yesterday). I remember how varied my emotions were. I was excited. I was anxious. I was nervous. I wondered if I was making the right decision. Years later, I look back at that time with fondness. But if I were to be completely honest, I made many mistakes throughout the process of purchasing my first home.
I know there are tons of articles out there full of great tips for first-time home buyers. So I’m not going to share those same tips.
What I will do is give you the list I wish someone had given me (which I couldn’t easily find covered elsewhere) when I decided to purchase my first property.
TAKE TIME TO LEARN ABOUT THE NEIGHBOURHOOD
The quality of neighborhood is one of the primary considerations before you buy a new home. You might have found a nice property not knowing about the neighborhood prior to move in. What if you realize it is not as a secured and peaceful environment as you thought it would be? Take the time to learn about the neighborhood. Check it out personally in the morning, afternoon or at night time. Have a personal feel as to how it is living in that place.
LEARN THE MARKET PROCESS
There are certain steps you need to learn as a first time buyer. From searching for a property, applying for a mortgage loan to the final turnover of the house, it helps that you are knowledgeable with how things work. Get to know more about the current market. Be familiar with the mortgage rates like variable mortgage rates, closed term fixed rate and short term fixed rate mortgage rates so you know your financing options. By understanding the process and the market, you are sure of a good buy.
HIRE PROFESSIONALS WITH A GOOD REPUTATION AND HIGH QUALITY OF SERVICE
Rely on professionals as your attorney, mortgage broker, real estate and insurance agent. A professional in your corner is always beneficial. Choose a real estate agent with good credentials and a solid reputation, who will help and assist every step of the way. Make sure your realtor is well-informed about every aspect of the features you are looking for in a home. As well, he/she should be knowledgeable about the neighborhoods you are interested in.
RESEARCH SPECIAL PROGRAMS AND INCENTIVES FOR FIRST TIME HOME BUYERS
Buyers of their first home are offered grants or incentives. The government helps first-time home buyers. There is Home Buyer’s Plan that allows buyers secure a loan with an amount up to $24,000 tax free. You can also avail the 5% down payment program specifically provided for first time home buyers. You may also want to apply for the Home Buyer’s Tax Credit Program where you can get tax credit on your yearly income tax return.
TAKE NOTE OF ALL EXPENSES INVOLVED IN YOUR HOME PURCHASE
As a first time home buyer you might think your fine because you have the down payment and enough for closing cost. Uh uh – it doesn’t end there, friend. And this next point cannot be overemphasized – it is very important to include the cost of utilities, moving expenses, upgrade/renovations that need to be done soon after you move, and even commuting costs (if you happen to be moving further from your place of work). So give the utility companies a call and find out what your average or likely monthly costs will be. If there are upgrades or renovations that need immediate attention, get an estimate so that you could include it in your budget and plan properly for it.
Budgeting all these additional expenses will give you a more accurate picture of whether or not you can afford the house. As well, it will help you to plan better so that you don’t end up house poor.
DON’T FALL FOR THE STAGING
When I was a first-time home buyer I didn’t know homes were staged. I laugh now thinking about. Yes, a lot of work goes into adding pieces and various other touches to stage a home so that you love it! But as much as staging can help you envision yourself in the home, be careful not to let your emotions fall for the ‘sights.’ Mentally try to remove the staging and see your own furniture in the home. Also, look at the outlets and other functional features to ensure that they are satisfactory for you and that they suit your needs and requirements. Focus on the layout and the structure of the home.
HAVE A LONG-TERM VIEW
How long do you plan on staying in the home you will purchase? How long will the home meet you and your family’s needs? If you plan on staying for a short amount of years and then selling the home, take a good amount of time to consider features of the home that will make it a good buy, even in a down market. For example, if you buy a house on a busy street, it may prevent families with children from buying it when it comes time for you to sell. So you would lose that demographic of potential buyers.
DO A HOME INSPECTION
Home Inspectors evaluate the systems and components inside and outside the home from foundation to roof top. The cost of a professional home inspection is based on the size and age of the home.
In most cases, the home inspection fee is worth it. It may save you from buying a home that looks great on the surface but is ridden with problems that you couldn’t see with your untrained and inexperienced eyes.
Your real estate agent can recommend a good home inspector with a great reputation.
READ THE CONTRACT
This is very important. Yes, your realtor should be ensuring that the contract doesn’t present any problems for you and is drafted with your needs and interest in mind. But YOU need to make sure that you understand FULLY any terms on the contract. Do not be afraid to ask your realtor if you are unsure about anything. ANYTHING. This is probably one of the largest purchase you will ever make in your life so you can’t sign away your precious signature without full knowledge of what you are agreeing to.
BE A RESPONSIBLE FIRST TIME HOMEOWNER
The last tip is for you to take responsibility for your purchase. Once you have completed the deal and settled in your new home, your work is not yet done. You have to start saving for home maintenance immediately to ensure that your home continues to be a sound investment for years to come.
I hope this helps! I know information like this would have been a gem for me years ago as a first time home buyer. But hey, my mistakes mean you don’t need to make them!
I’d love to help some more so if you have questions, drop me a line or message me on Twitter or Facebook. Or call or text me!