Crucial Factors to Consider When Purchasing Your First Home
October 21, 2022
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To call buying your first home a big step is an understatement.
In addition to representing an important pillar of adulthood, making the jump from renter to homeowner stands to improve your quality of life and instill a tremendous sense of accomplishment.
Given what an important decision this is and how much capital is at stake, it’s in every first-time homebuyer’s best interest to cross their t’s and dot their i’s before committing to purchase a new home.
To help prevent yourself from making an unwise investment, take care to consider the following factors when seeking out your first house.
Local Property Values
Before making a serious offer on your first home, take some time to research local property values. The benefits of this are twofold.
For starters, getting a feel for local property values will provide you with a better understanding of what a home is truly worth. Secondly, this research will give you a good idea of how much you can expect to get for the property should you ever decide to sell.
Learning about local property values can also strengthen your position at the bargaining table. For example, if you find that similar homes in the area are selling for much lower prices than what the owner is asking, you have every right to ask the seller to explain the rationale behind their pricing.
Additionally, should their answer prove unsatisfactory, amend your offer to reflect the property’s true value.
Location of the Home
When it comes to first-time home buyer tips, few are more important than engaging in proper location research. You should never purchase a home without first researching its location.
In addition to looking into local property values, take some time to educate yourself on the local economy, centers of commerce, and rate of population growth. It’s also important to remember that the location of your home can have a considerable impact on your daily routine and general lifestyle.
For example, if you’re interested in buying a home that’s located a fair distance from your place of business, it’s worth asking yourself if this residence is nice enough to warrant a longer commute.
It’s also a good idea to look into an area’s crime rates and general safety. No matter how enamored you are with a home, living in an area where you don’t feel safe can be a tremendously stressful experience. So, before committing to buy a home, make sure to engage in thorough location research.
Condition of the Home
Before making a serious offer on your first home, you’ll need to accurately assess the property’s condition – which will require you to enlist the services of a certified home inspector.
Even if the seller is vehemently opposed to an inspection taking place, this is one condition upon which you should refuse to budge. For one thing, you may find yourself unable to purchase the best home insurance for a property that hasn’t undergone a professional inspection.
Secondly, in the absence of a thorough inspection, hitherto-concealed problems are liable to rear their head well after a sale has been finalized.
For homebuyers, there’s really no downside to insisting on an inspection. Not only will they provide you with the necessary information to make an educated decision, but they also stand to enhance your bargaining power.
If the results of an inspection reveal the presence of problems you hadn’t been made aware of, you should insist that the cost of addressing those problems be taken off the asking price.
The Size of Your Down Payment
Many of us are wired to save money at every possible opportunity. And while frugality is often a good thing, it’s unlikely to serve you well when it comes to making a down payment on your first home.
To start with, if a lender sees that you’re willing to make a large down payment, they’re liable to feel much safer approving your application for a mortgage loan.
Secondly, the larger your down payment, the lower your monthly mortgage payments are likely to be. So, provided you’re able to comfortably do so, take care to make the largest down payment possible.
Purchasing your first home can be a tremendously exciting experience. However, if you’re not careful, it can also be a tremendously stressful one, too.
Since this is likely to be one of the most expensive purchases you ever make, it’s in your best interest to be meticulous and discerning when seeking out your first home. To this end, remember to carefully consider the factors outlined above before getting started on any paperwork.
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