Buying a home isn’t as easy as it may seem. Here are a few first time home buyer tips to make the process go smoothly and to help save on housing costs.
First Time Home Buyer Tips #1
It’s better to buy a smaller home in a neighborhood that you love, instead of a bigger home in an area that you don’t like.
There once was a couple who bought a new home that backed to a major highway. Of course there was a lot of traffic noise. But they figured it wouldn’t be a bother since they didn’t spend that much time outside.
Six months later they put the house on the market for sale. Not because it had appreciated in price, but because they couldn’t stand living there.
They were so desperate to move, they were even willing to sell at a loss!
Two Are Better Than One
Although bigger isn’t always better, it is when choosing the number of bedrooms in your new home.
That’s the second most important of these three first time home buyer tips.
First time buyers tend to think only of their personal situation rather than how easy the home to be to re-sell. Buyers who have a family, or are looking for extra space to rent out as a vacation rental property on websites such as Airbnb, will automatically pass over a smaller home for sale that has only one or two bedrooms.
Sometimes you have to be creative and think hard about how to make the best offer in a seller’s market.
As attractive as they might seem at first glance, interest-only loans can end up being a big problem for the first time home buyer.
Many people are used to a real estate market that only goes up. But history shows that all markets – real estate in particular – run in cycles.
Financing with an interest-only loan means that none of the principle is getting paid off, and that the borrower thinks that interest rates will always be low.
Because interest-only financing options are for short periods of time, the buyer may end up having to re-finance the loan when interest rates are beginning to rise.