Step-by-Step to Your first Home: House Hunting Tips
Visiting homes and open houses is the fun part but it also can be overwhelming and stressful if you don't stay organized and focused. Here's a step-by-step plan of action that will keep you on track as you search for your first home:
Step 1
Determine the maximum house you can afford
Even though you're pre-approved for a certain loan amount, that doesn't mean you want to max that out without considering other expenses, such as home maintenance, utilities, insurance, property taxes, and homeowner's association fees. Take these additional costs into account to find out what you can truly afford for a monthly mortgage payment.
Step 2
Narrow down the neighborhood
First and foremost narrow your search by location to help keep you more focused and efficient. By deciding WHERE you want to live, the rest will fall into place when you add your budget requirements into the equation. Basically, you'll find only a certain number of homes for sale within your budget AND in that location.
However, keep an open mind and explore other neighborhoods that have the same characteristics as your favorite but are less expensive or may have a higher inventory.
This also is the time to determine if you want to hone your search to condos, townhomes or single family homes. Your decision can affect which neighborhoods you will visit since some have a mix of home styles but others may just have one type.
Step 3
Make of checklist of needs versus wants.
This is an important step in determining what you REALLY REALLY need and gets down to why you want to own a home in the first place.
You need two bathrooms but want a master bath and suite. You need three bedrooms but a fourth bedroom would be nice for guests. See the difference between a need and want? You shouldn't compromise on your needs but could on your wants.
Your "needs" should focus on the things that you can't change such as kitchen size, living space, storage and closet space, including neighborhood and commuting time. Also remember some "future" needs in the next five years, such as space for a child. Hopefully you can find a home that has a blend of your needs and wants.
Step 4
Stay organized and look with a well-trained eye.
Bring your checklist and a camera to take pictures of the interior and exterior. Keep a file on each home or write your comments on its MLS printout. This will help you remember what you saw and your reactions, both positive and negative. You'll be happy you have this after a busy day looking at homes!
Here's a handy list of what to keep in mind when looking at homes (some items a professional inspector will discover but it's always good to spot troubles early on):
• Look at the home's potential and NOT how it's currently decorated. That ugly carpet and paint color can be changed easily and inexpensively.
• Get past the staging and see what the house truly offers you. Don't be swayed by that granite countertop and beautiful cabinets if the kitchen is still too small for your family.
• Focus more on the size of the home, its floor plan, room flow, and room layout. Does it work for you and your needs? Can you live in a galley kitchen?
• Make sure kitchen and bathrooms work properly. These rooms cost more to renovate so you want the expensive items in these rooms functioning. You might not want white appliances but don't knock them if they still work; you can always upgrade to stainless steel later on.
• Check for signs of a leaking basement. Wet basements can be a nightmare so be sure it includes a system to remove water if necessary.
• Look for good bones, especially in older homes. Are there any cracks on interior and exterior walls? Is the foundation solid and level? Are the wood floors in good condition?
• Keep in mind if you like windows and sunshine and if there is enough for you. Or maybe you like more privacy. What about the view from different windows?
• Examine the condition of the home's exterior, such as roofing and siding. These can be expensive replacements that you don't want to tackle right after you move in!
• Does the home have AC? What about the condition of its plumbing and electrical if it's an older home?
• Finishing touches such as crown molding and hardware are nice but don't focus on them since you can add later.
• Is there room for expansion? This home may meet your needs for the next five years but it's always good to see if you have the yard space to enlarge in the future. This is especially true for older homes inside the beltway.
• Check the zoning so there are no surprises after you move in, such as a new development or commercial business. Also, zoning could restrict any future plans for renovations and expansions.
Step 5
Return for second visits to your top contenders.
The first time you visit a home, you may react with more emotion. So it's important to return to your top contenders for that second visit. The timing of course depends on the current market and how quickly homes are going.
With less emotion on your second visit, you can be more analytical and spot things you didn't catch the first time. Some homebuyers bring along family and friends this time to gage their reactions. This could work for you or against you, so think carefully before you want others' opinions.
Step 6
Make a final decision and move on to final steps.
Now it's time to make a decision based on your needs, wants, and budget. Are you willing to make any compromises? Are you willing to bid on a home that may need work? This is a major financial investment so think carefully over the pros and cons of this home before making an offer.
As you can see, you're on your way to your first home by taking the above steps.
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