When venturing into the world of home ownership, first-time buyers often find themselves having to make important, fast decisions in what feels like a surreal situation — after all, it might have only been a few weeks since owning a home seemed more like a far-off daydream than an immediate reality.
A few common sense tips will help you navigate these unfamiliar landscapes as you move towards one of the biggest financial decisions of your life.
Though a pre-approval isn’t a guarantee that you’ll get a mortgage when you’re ready to buy, having one can give you a firm grasp on what you can afford before you start looking. A pre-approval from your bank or lender will save you time by narrowing your search to a more precise selection of homes, and this, in turn, can protect you from the all-too-common disappointment that follows setting your heart on a house you can’t afford.
Don’t expect your standards of living to change
It’s bound to happen: you see a house that maxes out your budget, but you imagine you can make it work by cutting out things like morning coffees, cellular data and cable TV. Remember, ‘roughing it’ for the sake of your house quickly loses its charm, and you’ll soon regret the lack of wiggle room for things like new furniture, redecorating, or unexpected repairs. Don’t rue your first home — avoid becoming ‘house poor’ by staying below the upper limit of what your bank is willing to lend you.
Make a list and check it as many times as it takes
Each property you consider will have its own unique combination of pros and cons, and parsing through them can feel a little like comparing apples to oranges. Don’t expect to stay clear-headed when the house with the poor walking score has the kitchen of your dreams; instead, stay on track by building a list of “must haves” and “nice to haves.” Though your list might evolve over time (especially if the “must haves” are rare for your price range), having a set of self-imposed guidelines can keep your search on course when you’re feeling overwhelmed by options.
Don’t confuse 'first home' with 'forever home'
Most first-time buyers start out a little starry-eyed, imagining that new home will be stylish, spacious, efficient … basically, everything they’ve been dreaming of. In reality, being able to afford a house that has everything you want is pretty rare in the first go-round, which can make you feel so discouraged you start closing yourself off to the available options. Remember, your ‘starter home’ doesn’t have to meet all the criteria of your ‘dream home,’ and the equity you’ll build for the next few years will get you closer to your goal.
With so much new information to absorb, steps to take, and decisions to make, buying a first home can feel like a rollercoaster ride. It’s important not to lose your head throughout all of it. Taking a few steps to keep your expectations rooted firmly in reality can help you glide through the process and feel confident in your final decision.