Life

Tips for First-Time Home Buyers

First-Time Home Buyers (1)

As I shared in a recent life update, David and I bought our first home last fall. Prior to buying, we lived in rentals, mostly in New York City, and knew basically nothing about the home buying process. It was a steep learning curve to say the least! While I’m certainly no expert now, I learned a few things along the way and wanted to share my top tips for people who are in the same boat and house hunting for the first time. Buying can be overwhelming and scary, but if you wind up in a place you love, it can also be one of the best decisions you’ll make. I hope the following tips help make the process a little smoother!

1. Know how much you can afford: I mean know how much you can really and truly afford comfortably. This may seem obvious, but what a lender will qualify you for mortgage wise and what you can actually afford to spend on a mortgage each month minus all your other expenses are two very different things. When lenders determine how much you qualify for, they look at your gross pay as well as existing loans and debts. This is a very misleading picture of your finances. It doesn’t factor in how much you contribute (or plan on contributing) to your 401K or what other kinds of deductions you may have due to taxes, health care, etc.  It also doesn’t take into account your other “discretionary” monthly costs, like how much you typically spend on groceries, gas, a gym membership, and other recurring expenses. And if you have young kids, you can’t forget about the cost of childcare! Where we live, daycare is SO expensive. It’s essentially the equivalent of another mortgage. When it came time for us to figure out what we could actually spend, I created an itemized excel spreadsheet listing out all of our costs or anticipated costs so that we really knew where we stood. At the end of the day, what we actually had left over to spend on a mortgage was significantly lower than what we could have technically qualified for.  

2. Determine your priorities and what you’re willing to compromise (or not) on: If you’re buying a home with a partner, you may have differing views about what’s important. This was true in my case. For example, one thing that’s really big for me is walkability, but my husband doesn’t care as much about this. Regardless of whether you have the same priorities, you should spend time talking about and even writing down what’s important to you so that you begin your search on the same page. I recommend marking each item as “essential” or “nice to have,” so that you don’t majorly limit your options. And be realistic about it. You’re most likely not going to find a place in your budget that has every single thing you want (if you do then lucky you!), so be reasonable about compromising on some of your wish list. Do you really need four bathrooms? Or can you get by fine with three? Only you can decide what’s ultimately going to be a deal breaker, but you want to go into your search having thought long and hard about it. Having a list ready will also help when it comes time to working with a realtor because you’ll already have your must-haves prepared.

3. Find a realtor you really trust: Speaking of working with a realtor, don’t go with just anyone. Buying a home is one of the biggest, if not the biggest investment you’ll make, so who you choose to work with to find the home of your dreams is important. You have to fully trust that your realtor has your best interests in mind. Referrals from family and friends are great, or you can do some research online, read client testimonials, or even ask a moms group on Facebook to find someone you think you’d mesh with. If you happen to be house hunting in the Lower Fairfield County section of Connecticut, I couldn’t recommend our realtor, Suzette Kraus, more highly!

4. Don’t act on emotion alone: I’m generally a very pragmatic, practical person, but even I can get caught up in the emotion of how a house feels and throw my rational side out the door. This happened at one of the first houses we looked at. I had a feeling from the listing that I was going to really like it and I was right. I actually loved it in person. It was an old colonial-style home with a white picket fence, a wrap-around porch, and amazing curb appeal. Everything about it just oozed charm. It felt so homey and cozy and, despite lacking a number of things on our wish list, it totally won me over after our first visit. I couldn’t get the house out of my mind, so we went back to see it a second time and we were this close to putting in an offer. My husband was supportive if it was the house I really wanted, but I decided to sleep on it.

Ultimately I came to my senses and realized that we would be compromising on way too many things (and important things at that) if we were to get this house, charming as it was. For one, it was old. There are old houses and then there are old houses, and this one fell into the latter category. It was built in the 1800s! That’s part of why it felt so historic and charming, and truthfully the bones of the house are probably much better than more modern homes. But, there would definitely be a lot of maintenance on a house that old, no matter how well it was originally built, and that’s not something we were prepared for. Secondly, there was very little closet space throughout the house. Two of the three bedrooms didn’t have closets at all, and being quite small to begin with, there wasn’t much room to add them. With all of our stuff, I don’t know how I ever thought that would work for us! The house also didn’t have central air, which was something I really wanted, and it had a pool, which is something I really didn’t want. And because of the pool, there was basically no yard to speak of at all, another big downside. Lastly, it was in a neighborhood that had very few sidewalks, was essentially non-walkable, and was a bit of a hike from the downtown. I would have felt isolated and miserable. Reading over this now, I can’t believe how close we came to making an offer, but there was just something about the house that made me think I had to have it despite its flaws! The moral of the story is, don’t get caught up in emotions to the extent that you overlook the practical.

5. Start your search early: If it’s possible, I recommend starting to look at houses months before you actually want to buy. It’s so helpful to see a bunch of places early on so that by the time you’re ready to actually buy, you have a good sense of what a good deal is vs. a bad one. At the start of our search, some of the homes we saw in our price point left us a bit disheartened. We weren’t sure we were going to find something that we liked enough that fit within our budget. By the time our current home hit the market, we knew the minute we walked in the door that we had to act. Based on all the other homes we looked at before, we knew we weren’t going to find anything more perfect for us for the price. I don’t think I would have had such confidence in the decision if I hadn’t seen a bunch of other places first.

6. Spend time in the neighborhood: In other words, act like a local! It’s not just the house you’re buying into, but also the neighborhood. Take some time to explore and get to know it. David and I walked Jackson around our street and even took him to play at the playground at our local elementary school. We ate at some neighborhood restaurants, checked out what grocery stores were nearby, and how far we would be from the train, the library, and other things that are important to us. Now that we’ve been living here for several months I can say that we are both so, so happy about our decision to live in an area that’s centrally located. Having the option to walk into town vs. having to get in a car and drive 15 minutes is amazing, and being so close to the train is a huge time saver for David in the morning. For me, it’s all about location!

I’m sure there’s something I’m leaving out, but these are the big considerations that come to mind when I think about our experience. If you have any additional tips about buying a home, be sure to let me know!