Buying a house is stressful for anyone; after all, you’re likely spending hundreds of thousands of dollars on a huge commitment. But if you’ve never bought a house before, it can feel downright overwhelming. You don’t have the experience of someone who’s already bought a house, and you don’t have the benefit of being able to sell your older house to fund your purchase.
However, people buy houses for the first time all the time, so it’s obviously doable. It’s also a great goal to have and can give you a lot more financial security later in life. So here are a few tips to give you a head start.
Use a First-Time Buyer Program
As mentioned before, you have a lot of disadvantages as a first-time buyer. But the good news is that you can access help for first-time buyers. Look into this help as early as possible, ideally years before you actually want to buy a property, because this will give you time to save and prepare yourself.
You also have another advantage. Most people buying a house have to also sell their old one, which causes delays and other complications. But you have more freedom to buy and move in according to a timeline that works for everyone.
Save for a Deposit
Speaking of being prepared, you also want to save for a deposit as soon as possible. Most deposits for mortgages are about 5-10% of the value of the house you’re going to buy. This adds up to thousands of dollars that you need to have in cash. You will also likely end up spending more on administrative costs and other costs when buying and moving into a house.
In short, start saving as soon as possible.
Get a Pre-Approved Mortgage
Even if you’re not quite ready to get a house yet, you can make your purchasing journey much easier by getting a pre-approved mortgage or a mortgage in principle. Essentially, this gives you an idea of the kind of mortgage you can get and how much you can afford. Even better, it makes it much easier to actually get the mortgage when you want it.
Fixer-Upper or New Build?
Some people prefer to get a cheaper home that they will renovate, while others like the idea of being able to just move in straight away. One huge downside of investing in a fixer-upper is that it can be extremely stressful to renovate your new home. It can also be a lot more expensive.
These challenges lead many first-time buyers to buy a new build. However, buying a fixer-upper can work if you have the time and money to invest in the property, and you could end up with a gem.
Who to Hire
When buying a property, you will likely need to hire a team of professionals to help. This includes a realtor to help you find a property and negotiate on price, a real estate attorney to help with the legal side of things, and a house inspector to make sure the house you’re interested in doesn’t have any nasty surprises.
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