1. Check out the neighborhood as much as you do the house
“Location, location, location” is a popular phrase for good reason, but sometimes it gets skipped over by excited first time home buyers. Too often, I see buyers get wrapped up in wanting the white subway tile backsplash and granite counters that they forget to look at the neighborhood.
Is it well maintained? Is there noise from a busy road or highway? What about that wooded lot behind the house- who owns it and could you be living next to construction noise if the owner decides to build another neighborhood?
Start with a popular part of town, every city has at least one, and work your way out until you can afford a home. That way you will always take part in the wave of appreciation. If you’re in Charlotte, think Uptown, South Park, and Ballantyne. Then examine the neighborhood itself and ask your Realtor if they think this home and its location is a smart investment.
2. Talk to a few different lenders
I occasionally have clients that are set on using one particular lender, whether that is a friend in the business or the bank they already use for their savings accounts. They don’t want to even compare interest rates or down payment programs with anyone else, and that always confuses me! With this being the largest financial investment I will probably ever make, I want to talk to several of the best lenders I know and compare my options.
3. You’ll want to spend a lot when you move in, so don’t spend all your money on the down payment
Even I underestimated what I would spend after closing on my house. Many people think the largest housing expense is your down payment, but furnishing your home can add up quickly, especially if you are starting from scratch and don’t currently own any furniture. Make a quick budget of expected furniture expenses when you are house shopping so that you know how much you need to save and not spend on the down payment.
4. Don’t buy the couch before the house
Don’t. Do. It. And definitely don’t finance anything- cars or furniture- while you are looking for a house. I sometimes still see buyers walk into a showing with me and say that their new couch just won’t fit here. This throws us for a loop when we are now trying to find a house that meets their needs plus has the right living room layout. Focus on finding the best house for you and then find the furniture and decorations that look the best in the space.
5. You don’t live with the purchase price. You live with the mortgage payment.
This is perhaps the number one thing I have to communicate to first time home buyers. Sometimes buyers will come to me and say that their bank has approved them for $300,000 loan but there’s no way they want to spend that much. Their lender then breaks down that means a $1,550 mortgage payment (this is just an example) and suddenly that sounds very doable to them.
A purchase price will always sound like a lot of money, but you don’t live with that number, you live with your monthly mortgage payment. This is why it’s important to talk to a few great Lenders and understand how interest rates affect your payment, so that you can find a monthly payment you are comfortable with.
Buying a home? If you are in the greater Charlotte, NC area, I’d love to help! Not in the area? I specialize in finding great Realtors in other cities. Let me connect you with a great Realtor near you!