10 Things I Wish I Knew When I Bought My First Home
I see my wife and me, almost 10 years ago, both excited and nervous about buying our first home. We were expecting our first child and it was our first major purchase together. The market was saturated with first-time home buyer offers and we thought we’d be in a new home in no time. Rookie mistake.
According to the National Association of Realtor’s 2014 Profile of Home Buyers and Sellers, buyers typically spend 10 weeks searching for a new home and view at least 10 before buying. It’s an extensive process. Prepare yourself for the biggest purchase of your life – here are 10 things I wish I knew before diving headfirst into home ownership.
10. Know what you want and don’t settle. My wife and I had a set list of “must-haves” for our new home: ranch-style, 3+ bedrooms, good school district, 1.5 bath, basement, decent backyard. Searching in a seller’s market, we couldn’t find anything that fit, so we settled. Having only one bathroom and no basement would be a temporary inconvenience, right? Nearly 10 years later, reservations are required for the bathroom and every time I have to get the ladder out to go into the attic, it’s a reminder…never again underestimate the value of a basement.
9. Get professional help! Our family and friends were willing to help us, but we decided to get professional help. Fortunately, my wife had a co-worker who was a licensed real estate agent. Unfortunately, we couldn’t find anything at the time and gave up. When we found a place on our own, we went at it alone. Homer Simpson said it best, “D’oh!”
8. Know the value of the home. We checked several real estate websites and our county’s website. At best, we found the estimated value, but not the real value. An agent familiar with area home values would have been useful!
7. Don’t be afraid to ask questions. We bought our home from a widow (and a friend of a friend), who didn’t know much about the home’s improvements. The mutual friendship and her status as a widow, made us a little apprehensive to throw a bunch of questions at her. That was ridiculous and it takes us back to #9. An agent could have handled the “dirty work” for us. It was a major financial transaction. We should have checked our emotions at the door!
6. The difference between a home appraisal and a home inspection. To us, they were one and the same. Our lender required an appraisal, so we thought that was all we needed. The difference? An appraisal is a formulated opinion of the property’s value (based on proximity, size, condition, recent sales of similar homes). An inspection focuses on the home’s condition and its significant components.
5. Check everything in the house…everything! If it has a switch, handle, knob or cord, check it. Yes, an inspector will check most of it, but that’s later in the process. Don’t be misled by fresh paint, new carpet and floors, or be afraid of offending the owner. Get an idea of the home’s condition early. Don’t wait until your first night in the house and your pregnant wife (delivering the next day) tells you the toilet is doing its best impression of Niagara Falls.
4. Be open to stay a while. We planned to stay in our home for a few years. Foolishly, we thought whenever we decided, it would be easy to sell and move. However, the only moving we did was for other people.
3. Don’t expect your home’s value to appreciate immediately. When we bought, the “experts” were pushing home ownership over renting. “Why waste money renting, when you can buy and benefit from a home’s equity?” Seemed like a no-brainer. No one wants to waste money or pass up the chance to get more. When the housing market crashed, we were in the number of Americans who saw their home’s value depreciate. Thankfully, it’s heading back in the right direction.
2. Avoid major changes. Going through a first pregnancy was stressful enough. Adding a home search and potential move to the list, daily life got overwhelming. If finding a new home is your top priority, try to avoid other major life changes.
1. Don’t be afraid to walk away. Initially, we did walk away from our current home when negotiations weren’t in our favor. Be prepared to walk away. For most of us, this is the biggest purchase we’ll ever make. Avoid being pressured or making emotional decisions. And, despite all the benefits that come with owning a home, be sure it’s the best option for you.
What do you wish you knew before you bought your first home? Tell us below.