5 Important Home Buying Tips
5 home buying tips for first-timers and old-timers
(BPT) – Whether you are buying a home for the first time or you are just looking for an upgrade, it is never a bad idea to arm yourself with home buying tips that can make your search go from overwhelming to enjoyable. Rather than learning the hard way about hidden expenses and difficult neighbors, there are things you can do to feel more confident as you begin your search.
With a seller’s market in many parts of the country, these home buying tips are even more important as you battle other buyers for the home of your dreams. The more efficient and straightforward you are in your search, the better chance you’ll have to hear “offer accepted.”
Consider all the costs
When starting the home-buying journey, the first thing to consider is the cost and expenses. When pre-approved for a mortgage of a certain amount, keep in mind that number is not a target – it is a maximum. While a seller’s market often means little wiggle room on price, your best bet is to find a property below that number so you have a financial cushion when negotiations happen.
It is important to remember the mortgage is not the total cost of your home. It usually only covers principal, interest, property taxes and homeowner’s insurance premiums. Home ownership involves many other expenses like closing costs, home repairs and potential yearly increases in property taxes.
Last, and something few people think about, if you have a life insurance policy, be sure to review it to make sure your coverage takes into account the mortgage debt on your new home. This ensures that if something happens to you, your family is financially secure.
Be flexible but firm
Finding the right home requires a delicate balance of flexibility and finesse. At the same time, you want to stand firm when it comes to your non-negotiables in your new home (price, school district, a second bathroom).
This is where having a real estate agent can be of enormous benefit. Agents have the expertise and time to devote to your search that allows you to flex when the opportunity arises and get a home that doesn’t break your budget. Finding the right agent is a lot like finding the right home – you need to do your research. Get referrals for accredited agents and have meetings with two or three of them before deciding who to hire.
Make sure they have experience working with homes in your price point and are familiar with the areas you are looking to buy in. Lastly, do not sign an exclusive broker agreement unless you are certain you have found the right agent for you. There are many resources available to help you find an agent that understands your individual needs, such as USAA’s Real Estate Rewards Network.
Meet the neighbors
While the location is important, many factors feed into a great neighborhood. From disputes over pets and parking to personality clashes, neighbors can have a big impact on your happiness as a homeowner. Before committing to a neighborhood, take time to walk the street and gauge compatibility with the neighbors you meet. Talking with the neighbors may also reveal hidden quirks about the home you would not have known otherwise, such as a basement that constantly floods or an ongoing dispute about a property line.
More house is more work
Television shows have glamorized home renovation. Before deciding on a “fixer upper,” make sure you have a full understanding of what it will take – and how much it will cost – to make the house match your vision. Construction projects often take longer than anticipated and can reveal other problems that end up costing more money. If your home is a complete renovation you also won’t be able to live there during construction, so you need to ask yourself, can you afford to pay for two homes for several months?
Similarly, a larger house means more time and money spent on upkeep. A house with a big yard may have great curb appeal but will you truly use all that space? Be realistic, because the money for maintenance on a bigger house is money in your pocket at a smaller house that has many of the features you want.
Lastly, remember that no home improvement project will change your commute or how noisy the nearby traffic is.
Use your head, not your heart
One final piece of advice – do not let your emotions take over the process. Choosing a home can be stressful and overwhelming. It is important to keep a level head. No decision this big should be made on an impulse, so take your time and think through every aspect of the process.
To learn more home buying tips and tricks or to find a trusted agent near you, visit USAA’s Home Learning Center.
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12 responses to “5 Important Home Buying Tips”
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Some good tips to know, thanks. When my husband and I bought our current home, it was a very interesting experience. I tend to shop around with my heart and he uses his head, so to speak. I was really excited with one of the houses we were shown and was ready to make an offer. He insisted that we check it out further, and I’m glad we did. The neighborhood had a few serious problems with some teens.
Hi Cynthia. That same tip applies to most large ticket items you buy, houses, cars, etc.
Well said…do not rush into buying a home. I did that with my current home (7 years ago) and have regretted it since the first month in. And of course I waited too late to put it on the market, so we’re not getting a lot of interest in this buyer’s market. Don’t even want to think about how much money I will lose on this place…just hope I’m able to pay off the mortgage after closing!
Sorry to hear that Bill. Hope you can get out clean.
Thanks for the great home buying tips. My wife and I really want to buy our first one this year, so this is great to know! I’ll be sure that we both have good credit and have enough for a down payment, like you said.
Thanks Ross. Yes, get everything in order before you are ready and then get that pre-approval.
My husband and I are looking to buy our first home. I really liked your suggestion about making sure that your credit is in order. We want to find the right mortgage for our finances and credit is huge. We will be sure to do whatever we can now to build it up.
Hi Molly. Yes, getting your credit score as high as possible will benefit you in several ways, especially with a lower interest rate.
You’ve got some great tips for buying our first home. We’ve finally decided to take this step, so I’ll remember what you said here. My wife definitely needs to check her credit; she loves shopping, so hopefully it’s still good!
Thanks for your comment Zack. As long as your wife pays those bills on time, her credit should be okay, but check it early and correct it if necessary.
My wife and I would love to move into our first house together this next year. I appreciated the tips you provided since neither of us have any home buying experience. We’ll be sure to take your advice and figure out how much home we can afford before we start looking so that we can make sure we don’t fall in love with a home we can’t afford.
Hi Brett. You’re on the right track. Always buy with the head and not the heart.