Don’t fall in love with the first home you see. Follow this advice for shopping smart. When it comes to buying a home for the first time, buyers respond with their hearts.
Much like with puppy love, they see only the good in the homes that they fall for.
“Too often they fall in love with the exterior, and they’re not seeing the defects that are below the surface,” says Egypt Sherrod, an Atlanta Realtor and host of HGTV’s Property Virgins.
That’s why would-be first-time homeowners must take extra care to think through every decision, and avoid common pitfalls that novice buyers experience. Sherrod, also author of the recently published book “Keep Calm . . . It’s Just Real Estate: Your No-Stress Guide to Buying a Home” (Running Press, 2015), says everything becomes simpler when you understand it. “The purchase of a house is probably one of the biggest and most important decisions you will make, especially with a partner. Go into it with a clear mind and both feet firmly planted,” she says.
Also know whom to trust. Not everyone is qualified to give real estate advice, particularly well-meaning loved ones. Market conditions are constantly fluctuating. Additionally, the housing climate can vary from state to state. So you may be getting outdated or jaded advice.
But even with professionals be mindful of those who have a vested interest in you purchasing the property. Here, Sherrod and other real estate professional offer do’s and don’ts for mastering your first home purchase.
Do think realistically
You have to know how much you want to spend before you start to look, says Jay Caracci, a Chicago real estate broker in Chicago. The mortgage payment is just one portion. You also must budget for monthly expenses like property taxes, insurance and association fees. Also consider expenses like closing costs, inspection and attorney fees. “It’s more difficult for anyone to reset expectations once they fall in love with a home they simply can’t afford,” he adds.
Don’t ignore emergency planning
Sherrod says it’s crucial to have a financial contingency plan in case something happens. “After shelling out the down payment, you don’t want to be caught using up your last resources in case your water heater breaks, or your roof starts to leak,” she says.
Do shop for a lender
The Consumer Financial Protection Bureau reported that almost 50 percent of consumers who take out a mortgage for home purchase fail to shop prior to application. “This is unfortunate because often banks and mortgage brokers can only offer customers their own loan products, which might limit the options available,” says Ginger Wilcox, an executive at Sindeo, an online brokerage. “Unfortunately, there is not a one-size-fits-all loan for every home buyer, so it is important for consumers to shop around to find the best financing for their particular needs.”
Don’t be close-minded
It’s good to know what you want. But you also should keep your options open, particularly because new buyers are not always realistic with their expectations. Sherrod says you should be willing to look at different types of home in a variety of neighborhoods. Inside the home, focus on what really matters versus letting your head turn toward cosmetic qualities.
Do get an inspection
Even if the house is new construction, it’s advisable to get a home inspection, as even new homes can have a few construction defects. In older home, any deficiencies found during a home inspection can be used when negotiating the deal between the buyer and the seller.
Don’t accept the first counter-offer
A lot of first-time homebuyers are anxious to move. Tim Frie, licensed real estate sales associate in Tampa, Fla., said that once they start negotiating on a house they really want, it’s easy to act on impulse and immediately come up to the seller’s terms. A good real estate agent will be able to keep first-timers objective and extract the emotion from the transaction. That way the buyer doesn’t end up overpaying or agreeing to onerous terms.
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