Buying a house is a big step in anyone’s life. You need to think of and consider many things when you decide it’s time to have a place of your own. It is definitely not a decision to make on the spur of the moment. If you have been living in rented properties for a great deal of time, it is understandable to reach a point when you want to own a place. Indeed, renting is the better option for a period in someone’s life, especially if you are unsure of where you would like to spend a large portion of your life. However, even if you buy a house and then decide to move to a different city or country, know that renting it yourself is also an option.
Therefore, when it’s time to make this step, chances are you have laid a foundation that can support this decision. For example, having a good credit score is of the utmost importance. So, when you put the plan in motion to buy a property, you must know where you stand and whether your credit score can support this purchase.
If you find yourself in this stage of your life and want to buy a house, it might be helpful to read the following guide for first-time homebuyers to ensure you have everything checked on your list before you finally get the keys to your first home:
Make a list of all the costs involved
When you start thinking about purchasing a house, it is imperative you start thinking about your upcoming costs. Having a clear idea of this before you start any actions in this direction is highly advisable. This way, you won’t be caught off guard during this process. Plus, knowing the costs will make it easier for you when it comes to setting a budget. Some of these expenses are as follows:
- Any down payments;
- Closing costs, such as application fee and credit check fee;
- Move-in expenses: in case there will be any home repairments or upgrades needed;
- Property taxes, which usually are included in the mortgage but doesn’t include the interest;
These mentioned above are some of the costs you will have to take into consideration long before you go looking at houses. It is of the utmost importance you are as prepared as possible for when you start acting on this long-term dream of yours.
Ensure your credit score is solid
As stated earlier, your credit score can make or break a deal, such as buying a house. Even if you have never had a property in your name until now, or you don’t plan on doing this anytime soon, it is still helpful to strengthen your credit score. So, this is an aspect which many people should consider. A good credit history shows how reliable and well-balanced you are when it comes to spending, and this can be helpful for any kind of investment, whether it is a house, car, or you wish to finance your studies.
There are many ways to ensure your credit score is positive and you are building a solid credit history. For starters, when you have a credit card, you must always try to use a small portion of the amount available. What’s more, you should borrow the amount of money you can afford. When people start using credit cards for more than they can take, that is when they go into debt. So, using it for a small amount shows banks and lenders that you are responsible and calculated. Then, when you think about buying a house – which is a significant investment – you will have your credit score to back this decision up.
Calculate your savings and decide on a budget
There is no denying that the moment you start thinking about buying a house, you must start putting money aside. Hence, taking upcoming costs into account as well as market prices for the type of house you desire, you can calculate how much to save and for how long. Depending on your possibilities and how long you plan on building your savings, you can calculate and decide on a budget.
Setting a budget is crucial when negotiating the price for a house or apartment and when you put an offer on it. In some cases, you might feel pressured to spend more than you could afford and make some sacrifices in this direction so you can purchase the property. Sticking to your budget is a way of avoiding experiencing any financial stress later. Indeed, it is advisable to leave some wiggle room when you set the budget as, during negotiation, you may need to reach an understanding and put an offer higher than what you have initially set. However, it is crucial not to go overboard for fear of not losing the property. If it will cause you financial stress, it is probably better to look for something else.
Find a reliable real estate agent
Finding a house can be an exciting thing. You get to search for where you will spend a significant part of your life. As exhilarating as this may be, it can also be quite stressful as you may start to feel the pressure of finding something in a good location, fulfills your needs, and is within your budget more or less. Understandably, one may feel happy and overwhelmed at the same time.
Experts from Walton Robinson in Newcastle point out that “it is of the utmost importance to find a reliable estate agency that not only understands your needs and is committed to finding a suitable property but which you can trust that has your best interest in mind.” This way, no matter your budget and preferences, you know your estate agent will be able to advise you on what is best for you and guide you through the exciting yet stressful process of buying a property for the first time.
Check various open houses
As part of the house hunt where you will be viewing different properties based on your preferences and budget, and together with the help of your estate agent, you may also want to check open houses. This way, you get a better feeling of a respective neighborhood. Plus, by going to an open house, you also check how competitive the market is and the different price points.
Viewing houses in person is undoubtedly a must before buying or even renting a property. Only this way can you get a genuine idea of how the place is as well as the surroundings. Therefore, do not overlook and underestimate the importance of checking various open houses.