3 Things To Consider When Purchasing A First Home
First-time home buyers often have a lot to consider before purchasing their first home. Buying a home can have a big financial impact and can involve years of saving and budgeting. For many homeowners, finding a home that fits their lifestyle and that is also affordable can take some work. Looking at homes for sale can also be a little overwhelming. Here are three things that first-time home buyers should consider before purchasing their first home.
Needs Versus Wants
Distinguishing between needs and wants is a must for first-time home buyers. While looking for homes for sale, potential homeowners should consider things such as how close the property is to their work, whether or not there is enough parking, and whether the home is large enough for their needs. Needs should be prioritized over wants. Resale value is also important. First-time home buyers should consider whether or not their home will be easy to sell in the future before purchasing. If the home is in a less than desirable location or has a strange layout, it may not be the best choice for a first home that will likely be put on the market in the future.
Have A Realistic Budget
One problem that many first-time home buyers run into is that they are unsure of how much they can actually spend on a home. When it comes to mortgage payments, spending no more than 25 percent of take-home income is a good rule of thumb. However, mortgage payments aren't the only expenses that come with owning a home. First-time home buyers should also consider things such as closing costs and other fees that come with buying a home. Maintenance costs can also cost a lot more than first-time homeowners expect. Setting aside one percent of the home's value each year for maintenance is recommended, however some homes may require more than that.
Pay Attention To Appraisals
Before purchase, mortgage lenders will send an appraiser to determine the value of the home. If the appraisal falls below what the potential home buyers are willing to pay, it can be a problem. First-time home buyers want to avoid purchasing a home for a price above it's appraised value. This can be difficult after falling in love with a property. However, low appraisal values may indicate that the home is not a sound investment.
When purchasing a first home there are a few things that home buyers should consider. Making sure that the home meets the homeowner's needs is a must. A realistic budget is also important when it comes to purchasing a first home. First-time homeowners should also make sure they pay attention to their mortgage lender's appraisal of the home. Purchasing a home for more money than it's worth can have a negative financial impact down the road.