The housing market may ebb and flow with time, but good first-time homebuyers tips usually remain the same. If you plan to make the biggest investment of your life sometime soon, here are seven things you should do to get the home you want most – and, ideally, for a lower price.
1. Decide What You Want From Your First Home Ahead of Time
Houses are selling fast in 2022, lasting on the market for an average of just 18 days. Knowing exactly what you want before you begin shopping will help you make more immediate choices about a house you might like to submit an offer on.
Deciding what you want ahead of time also helps you refine your search to homes which best suit your values. Let your Realtor know whether you want to live in a specific location, or require a minimum size or maximum price tag. A little foresight goes a long way while preparing for a home search!
2. Secure Financing Before Contacting Your Realtor
It takes an average of 30 days to secure a home mortgage. You do not want to rush this process, and you do not want to begin submitting offers before you have the financing in place to submit them with total confidence.
Securing financing well ahead of a house hunt will also save you time. An online mortgage calculator is seldom very accurate. Your lender will tell you precisely how much you can borrow on a house, so you can limit your search to within your price range.
3. Don’t Spend as Much as You’re Able
You may have determined to buy the most expensive house that you are able. After all, why not make the most use of a home loan so long as it’s available? Well, you might have good use for some extra cash in the near future. At that point higher mortgage bills won’t make your situation easier.
Lowering your price range may also help you find a home you love even sooner. A cheaper house is oftentimes the most preferable, and you can spend some of the money you save on new furniture and decor. (Make sure to check your old couch’s cushions for loose change before dragging it to the curb!)
4. Don’t Back Down From a Down Payment
It may seem appealing to put zero money down on a home purchase, and there are in fact several circumstances where doing so could be advisable. But do you know what feels better than owning zero percent of your first home? Owning 20 percent. And unless you have a better investment for the money you could have saved on a smaller down payment, it’s usually better to put some skin in the game earlier on. It’s a head start on building equity!
5. Don’t Overlook the School District
You may not plan on expanding your family in the foreseeable future, but even a child-free homebuyer should consider their potential new home’s school district. According to a report by the National Bureau of Economic Research, when a neighborhood spends one additional dollar on its public schools, home prices there rise $20.
If you buy a home in an area with good school ratings, you can reasonably expect your home to fetch a better market price should you eventually resell. So long as there are parents, there will remain a high demand for homes near good schools!
6. Invest in a Thorough Home Inspection
Midwesterners are famous for our politeness. That’s why you may hesitate to have every nook and cranny of your new home thoroughly inspected – you don’t want to be a bother. But you are perfectly within your rights as a buyer to request additional inspection from a roofer, electrician, plumber or any other specialist if your general inspector detects hints of soon to come issues.
Hiring specialist inspectors will cost you more out of pocket. That added expense can easily pay for itself many times over, however, as you may request a price reduction and avoid shouldering the full costs of any needed repairs.
7. Read HOA Documents Ahead of Time
A homeowners association can benefit its community and its members in many ways, though you must make certain its bylaws are permissive of your lifestyle. Many HOAs restrict dog sizes or ban dogs altogether – and you certainly didn’t imagine making your next move without your best buddy at your side. Other HOAs may prohibit large cats, exotic pets, smoking, ATVs, mobile homes, commercial vehicles and even pickup trucks parked in driveways.
HOA documents are known as a material disclosure. They are understood to be of great interest of a buyer because their bylaws would affect them substantially. You have every right to leave a sale if you refuse to accept the property’s HOA documents in full!
There is one more piece of eternally good advice for first-time homebuyers: work with a good Realtor. If you are interested in homes for sale in Detroit Lakes, MN – or you’re considering selling your property during this hot sellers’ market – then we welcome you to reach out to the Action Realty team today!