10 Tips To Consider Before Buying Your First House
Ask any employee about what their dreams are and chances are they’ll tell you that one of their dream is to move into their own home. For first-time home buyers, nothing can be as exciting as finally getting the keys to a house you can call your own.
There’s that thrill you get when viewing a property for sale. Images start to form in your head about how you’re going to settle down in your new house. You can see yourself spending weekend nights looking out at the view from your balcony or imagining how you’ll decorate the kids’ room.
Emotions come into play in the home-buying process and all these happy thoughts of the future may push you to tell the agent to remove the “For Sale” sign on the property because you want to move in next month. But take your time and be strategic about it, buying a house can tie your finances for years to come.
Here are 10 tips to remember for first-time home buyers.
Property values rise and fall and these are influenced by various things including supply and demand, as well as the general economy. Of course, it would be best to time your purchase when property values are down.
2. Long-term plans for the property
Most likely, the property you are buying is for your primary residence. But have you thought about the long term? If you do plan to sell it in the future, the location of the property will have a big impact on its appreciation so you may want to put more weight on the property’s location when deciding which property to buy.
3. Size matters
While a sprawling mansion may be what your dream house looks like, size brings with it more costs.
4. Rental property demand
If you’re planning to buy a home with a plan to rent it out, study the demand for rental properties. Even when rental demand is high, don’t bank on getting someone to rent your property right away and paying off your mortgage with rent money.
5. Government home ownership programs
There are several programs from the government designed to help citizens buy their own homes. Do your research and see which ones you can qualify for.
6. Compare Home Loans
The bank of choice for many home buyers who plan to take out a home loan for the first time is the one they’ve had a long relationship with.
Yep, inflation, you’ll need to study the inflation trend to see whether a longer-term home loan (say for example a 30-year home loan) is more beneficial than a shorter-term home loan which can save you more interest payment.
If the inflation is high, the amount you will be paying in the later years of your loan may actually cost less compared to what they may seem in today’s valuations.
8. Build your emergency fund
Having an emergency fund becomes more important when you’re buying a home because you’ll need a way to meet the monthly mortgage payment if you suddenly lose your primary source of income.
9. Get an agent
You can do all of the legwork and buy a house on your own but getting the help of an agent can take the stress out of the home-buying process. An agent who works on your behalf can guide you through the process and advise you of ways to save money on the property that you are interested in.
Find someone with experience and someone you can trust. Ask for referrals from friends and colleagues.
10. Budget for additional costs when buying a home
Just like when making any important financial decision, don’t let yourself get carried away with emotion as a first-time home buyer. Give it careful thought, learn everything you can, and weigh all your options, especially when it comes to mortgage offers.
A clear head and a lot of patience would enable you to make the right buying decisions and benefit in the long term.