23 Things Every First-Time Homebuyer Should Know

Author: HTGV.com
Original Article

Lesson #1: Decide location versus space before searching for a home

When first-time homebuyer Jarrod was shopping for his first place in Chicago, he faced a tough decision: Should he buy a small home in Lincoln Park, his favorite area of the city, or should he buy a larger home for a lower price in Uptown, about two miles north of Lincoln Park? Jarrod wanted to spend some time weighing his options, but then another buyer made an offer on the Uptown home he was considering. He needed to make a quick decision or face losing the home, so he decided to put in an offer. The sellers accepted, and Jarrod got the home. But almost a year later, he’s still not 100 percent sure he made the right choice. While he loves having plenty of space to entertain in his Uptown home, he misses Lincoln Park’s proximity to restaurants and nightlife. Before shopping for a home, it’s important to set your priorities and decide which is more important to you: space or location. If you settle on this in advance, you can make thought-out decisions during the home-buying process and avoid the unsettling feeling of buyer’s remorse.

Lesson #2: Don’t commit before you’re ready

Owning a home is a huge commitment -- and a more expensive one than some homebuyers realize. Jarrod’s monthly housing expenses, for instance, have gone from about $1,300 a month as a renter to $2,200 a month as a homeowner. Before buying a home, make sure you know exactly what you’re getting into so you can decide if you’re financially and personally ready for such a large commitment. In addition to your monthly mortgage payment, figure out how much you’ll be paying for property taxes, homeowner’s insurance, HOA fees and other monthly costs of owning a home.

Lesson #3: Sweat equity can save thousands

First-time homebuyers John and Jennifer always knew they wanted to add value to the first home they owned. So when they bought their first place in Roswell, Ga., they immediately started remodeling, and they decided to tackle many of their home improvement projects themselves. The couple spent $20,000 remodeling their kitchen, building a new deck and installing a new patio -- upgrades that would have cost $50,000 by their estimation if they had hired a contractor to do the job. If you have the skills, the time and the patience to live with dust and debris for a while, do-it-yourself home improvement projects can save you a big chunk of cash.