The time has come! Whether you’ve been renting or living with relatives or friends, you are now ready to dive into homeownership. Here are our top tips for first time homebuyers like you.
Don’t rush it
First, give yourself some time to make the right choice. While you may get lucky and find the right home immediately, you should be prepared to spend several months shoring up financials, hiring an agent, researching and touring homes, making offers and closing on a home.
Gain financial footing
Financial experts say that you shouldn’t spend more than 28 percent of your total income on housing, but it really varies for each person.
You can determine your general range by playing around with online mortgage calculators, but it’s best to work with a lender to get pre-qualified or even pre-approved on a mortgage. (Learn the difference between the two here.) Why? Well, the difference between a $200,000 and $250,000 home can be stark, and it’s best not to get your hopes up before you know what you can afford. You can reach out seven days a week to get started on this process.
Enjoy the hunt
Now we’re getting to the fun stuff – the search! Just 20 years ago, buyers had to search through thick listing books to find homes that matched their price and location. Luckily, your search can begin from your couch, the bus, or while in line at Caribou Coffee.
Edina Realty’s home search apps have every active, available listing in Minnesota and western Wisconsin, so you can perform the most accurate and up-to-date search. If you’re on the go – like on a boat, or on a walk around your neighborhood – open up the Home Scan feature, which uses your device’s camera to show you homes in real-time.
Finalize your choice
Unless you’re an extremely decisive person, you’ll find yourself falling in love with homes in different locations, with varying styles, prices and features. That’s actually a good thing in today’s seller’s market; to get to the closing table, it may be necessary to keep your mind open.
Work with your Edina Realty agent to determine your top requirements, and which are “nice to haves.” Then remember the qualities that are unlikely to change. For example, a neighborhood’s walkability is pretty set, but you can always tear up carpet to put in hardwood floors, or refinish a kitchen to get the farmer’s sink you love. (If you think a fixer-upper is in your future, read up on 203k renovation loans.)
Once you have an established set of needs, it’s time to begin in-person showings.
Tour, tour, tour… and think resale
Your REALTOR® will set up showings for you – and yes, this should feel surreal. As you tour the properties, think of yourself as an inspector. Pay attention to when upgrades were done, or if appliances have been replaced recently. You’ll be your own landlord, so it’s important to take note of how much work your eventual home will need.
And while it may seem a long way off, talk with your REALTOR about the potential resale value of the home. Is it in an up-and-coming neighborhood with great schools? Determine if the appliances and systems are energy-efficient. Today’s homebuyers want green homes, but tomorrow’s buyers will consider these features standard.
Think also about accessibility. Are there highway plans in place to aid long commutes, or public transportation lines in development? For example, some St. Paul neighborhoods near the new Green Line of the Light Rail expect to see the same development as Minneapolis’ Longfellow neighborhood is currently experiencing.
If you’ve been renting over the last few years, you’ve likely experienced heartache over losing “the one” Craigslist property that seemed right for you. As you know, another comes along. Today’s buying market is extremely tight and mortgages can be hard to come by, so it’s best to prepare for a few lost deals before you end up at the closing table.
Of course, the most important part of buying a home is getting started. Reach out today to start the process.