First Time Home Buyers
First time home buyers should be extra careful in buying houses because they are more prone to making mistakes. Always weigh the pros and cons of buying versus renting the house of your choice making a decision. An overwhelming majority of people starts their home search online. Most people have gone through a large number of options before actually deciding on an estate agent. The average time for buyers to find a house ranges from 2 days to 2 weeks. Good real estate agents help you find a home in accordance with your needs. Mortgage lenders usually prefer a consistent job history. Consequently, you should try not to switch jobs unnecessarily because it would impact your credit rating negatively. You should not let your emotions bulldoze common sense because this can lead negatively impact your ability to make rational decisions.
It is not a good idea to see a large number of homes in one day even when it is physically possible. Experts advise against it because first time homebuyers will most likely be overwhelmed and would not remember the specific details of each house. You should see an average of five to six homes per day. Do not postpone your decision especially when you find an affordable home that is perfect for you and your family. First time homebuyers have the tendency to prolong their search unnecessarily even when they have their mind set on something. This is not the wise thing to do and wastes time and effort. Make a list of homes you like and tour them a second time to get a better feel of their pros and cons.
Choose the location, neighborhood, type of home, number of stories and interior very carefully. Every type has both pros and cons. Weigh all available options against your needs and affordability and make a decision. Suburbs are less expensive and usually have newer homes. However, you would be at a considerable distance from your workplace and entertainment hangouts. On the contrary urban areas are more expensive but are more likely closer to your employer, schools, restaurants and cinemas etc. Single-family homes appreciate more quickly, have the opportunity for gardens and are more private. Along with these advantages they tend to be more expensive and require more extensive maintenance. Condominiums (townhouses and cooperatives) are less expensive; more secure and require less maintenance and yard work. They are also newer so require less maintenance. On the downside they are noisier and are less private.
New parents prefer three bedroom homes with bedrooms on the same level. Three bedrooms are most common in all homes. Two bedroom homes appeal to first time homebuyers, singles and senior citizens. However, they will be willing to buy one-bedroom homes in case of extra den space. Homes with one bathroom are less expensive since most people prefer more at least two bathrooms in their homes. Bigger houses usually cost less per square foot than smaller ones. Still never be baffled by square footage alone because well designed smaller homes may appear larger than they really are. Bonus rooms add an extra to a home but cost more. Bonus rooms can be used for multiple purposes including playroom, gym, TV room and art studios etc.
As discussed above first time homebuyers make several mistakes when purchasing a home. Some of these are discussed above:
- When deposit the earnest money in the seller’s account. Rather you should deposit it in a trust account to safeguard your money until the deal is closed. This is because most sellers do not understand that the earnest money is not there to use until the deal is completed.
- Another common mistake buyers make is forgetting to buy home insurance and home warranties. Most lenders require home insurance and home warranties before advancing credit. So make sure you do not forget to buy it causing unnecessary delays in closing the deal.
- Most people forget to switch utilities in the excitement of buying a new home. Buyers often ignore this seemingly simple task leading to delays in closing the deal and moving in. Apply for utilities well before closing and deal. Find out the lead-time required for switching utilities and keep in contact with the companies to ensure against unnecessary delays. Do not forget to discontinue utilities at your previous home.
- Most experts advise against becoming buddies with the seller. Everyone has their own point of view and there will definitely be changes that you would want to make once you move in. Discussions about these issues with the seller are not advisable because you might want to change something they have an emotional attachment to. This can lead to personality conflicts clouding judgment. Thus this is an area best left alone.
- It is not advisable to tackle all details by yourself. Let your agent do his work. He will handle many of the day-to-day details with the seller and her agent. Your excitement may push you to micromanage wanting a part in everything. This can be harmful for your end of the deal. Let everyone do their job because they will handle than you could ever imagine!
- First time homebuyers often forget lender requirements in excitement of the deal. Be aware of these requirements at all times and take them into account at every step to avoid future conflicts. Remember moving into your dream home depends on it.
- Do not let your real estate agent push towards one house or another. Most first time home buyers are so baffled by the thought of their own home that they lose sight of all sense. Real estate agents may use this opportunity to convince you to buy a home that is not right for your needs. Do not let them do it under any circumstances because it can become the most painful and costly mistake of your life!