If you are in your 20s, 30s, or beyond and have never owned a home, you might be wondering when you should start thinking about making your first real estate purchase. There is no fixed rule, but here are some guidelines to follow when you are thinking about buying a home.
Can I Afford Buying a Home?
The first question to ask yourself is whether or not you can afford a home. In many cases, renting is a great decision. As a renter, you don’t have to worry about repairs, upgrades, or maintenance costs. But, if you can afford the down payment, owning a home can have a similar, or even lower, monthly cost than renting.
For example, when I bought my first condo, a roommate moved in and split the monthly costs with me. My monthly cost ended up lower than the apartment I had been renting before. When I recently bought a house, my down payment was large enough that my new monthly payment is about $200 per month lower than before.
Do I Want to Stay Put?
Another question to ask yourself before buying a home is whether you have found a time and location where you want to set up roots.
Buying a home has many costs, including transaction costs to buy and sell. If you find a place you want to be for at least five years, you might be in a good position to buy a home.
However, if you move regularly for your career, are unhappy with your city, or have not found a neighborhood you want to call home just yet, there is no need to rush and buy a home you are not ready for.
Can I Find the Right Home?
If you are financially prepared and have found an area you want to call home, congratulations! You are on track to become a new homeowner. Your next steps are getting your finances in order, finding a great agent, and searching for your new home.
When you are searching for a home, you can use real estate apps like Zillow to get an idea of how much home you can afford in your neighborhood.
Be sure to know your must have features like washer and dryer hookups, a garage, the number of bedrooms and bathrooms, and features you definitely don’t want, like a location near a strip club.
Once you’ve put your list together, work with your agent to look at potential homes. After viewing a few homes in the area, you will have a pretty good idea of what you like and what you don’t.
When you find the home you love, you’ll work with your agent to make an offer and get started on the paperwork. From an accepted offer to closing, expect about a month of paperwork, inspections, and appraisals to get your mortgage and title paperwork in order. Once you close, the house is yours!
Buying a home takes a lot of work, but it is easier than you may think. As long as you are well prepared, buying a home is a fun and exciting experience. And when you are doing it for the first time, you’ll love getting the keys and walking into a home that is truly yours for the very first time.