Buying your first home is a monumental occasion, one that you will remember for the rest of your life. But just because it’s a big moment doesn’t mean you should think solely with your heart. Real estate is a pragmatic choice as well, and it’s important to find a piece of property that will work for you now and in the future. Here are some very common mistakes first-time home buyers make that turn their first home into a nightmare in the coming years, and how to avoid those mistakes yourself.
1. Avoid Big Purchases Before Getting a Mortgage
While many of us want the house, the car, the cabin, the boat, and more, these things can rarely happen all at the same time. At the very least, it’s a good idea to stagger starting them. Avoid making any large purchases before you start your mortgage approval process. This could result in you having less money to work with when looking for a home, or be subject to higher interest rates. At the most extreme, buying a lot of big purchases before getting a mortgage could mean you can’t get approved at all, or it could lower your credit rating by a severe amount.
2. Avoid Sentimentality
Many people approach looking for their first home like leading characters approach love in cheesy romance movies: they wait until something just “feels” right. Its important to understand that your first home needs to blend practicality with what you want. And when push comes to shove, the practicality needs to be the winning side. Learn, before you start looking for homes, that the true excitement is in owning your own property. When you do that, you can make a more level-headed purchase and have a home that works for you now and in the future.
3. Know this is the First of Many
Once you buy your first piece of property, you’ll more than likely end up buying more in the future. It could be simply moving to a newer place that fits your needs in the future, or it could be expanding into the rental market. Whatever the reason, this home will not be the last you ever buy, so ensure that you pick something that works for you now as well as in the future. Starter homes will rarely check all of your ideas for a dream house, so make sure the first home is the right one for now.
4. Realize There’s Extra Fees
Closing costs are among the biggest surprises for first-time home buyers, many of whom believe the costs were already included. These closing costs can add up very quickly, and you will be expected to pay them. Factor the average percentage of closing costs into your final price, and be sure you can pay them, either through the mortgage or up front.
Buying your first home is an exciting time, but it can also be one that’s fraught with potential mistakes. If you learn to avoid the common mistakes of many first-time home buyers, your purchase will work much better for you, now and in the future.