Buying your First Home
Are You Ready For Home Ownership?
What you need to know
Owning a home may be your dream, but in order for the purchase to be the happy and satisfying experience it was meant to be, you need to ensure that you are financially and mentally prepared for the responsibilities that come with it.
Some people have a notion that homeownership is like renting, but with the power to have pets and paint the walls whatever color you like. However, while these privileges are usually available to homeowners, they come with the responsibilities of a mortgage, taxes and home maintenance. Preparing for homeownership requires you to take critical stock of your finances and your expectations. We don't want to rain on your parade, but we do want to make sure you're ready.
If you're at the beginning of the process and you just want to get an idea of what your payment would be for that house you saw for sale down the street, you can check out our basic mortgage calculator.
Questions to ask yourself:
Am I ready to buy?
Owning your own home is about more than just being able to decorate any way you like; it's about being prepared to maintain your home over the years, realizing that part of your income and time will go towards repairs and maintenance. It's about being willing to take the risks of homeownership with a realistic expectation of the rewards.
Should I continue to rent or should I buy?
Most first time homeowners will agree that the maintenance of owning a home does eat up some of your time and resources. If you are coming from an apartment, suddenly you have to mow the lawn weekly. If the AC or heat goes out you don't have a landlord to call. When a bad storm hits and the branches are in the front yard, you're the one that has to get out there and clean it up. For some, this is a small price to pay for calling the home you live in 'yours'. Others find the upkeep is a bit more than they want to take on.
How much am I qualified for? AND How much of a monthly payment do I really want?
It can be discouraging to find that your salary won't stretch as far as the home you want to own. However, sacrificing a huge part of your income just to pay the mortgage can very quickly make homeownership a burden rather than a point of pride. It's better to buy a modest home now and look at purchasing your "dream home" in a few years. But now that I'm done being 'mom', let's cover a few basics.
The first step in the home buying process is the financial piece. A key part of this equation is what they call your Debt-to-Income ratio. This is something that lenders take very seriously. Your overall debt should not be more than 40% of your income, and your housing debt should not be more than 32%. What 32% of your income will buy depends on where you want to live. It might not get you a penthouse in downtown Austin you were dreaming of, but you might find a great 3 bedroom, 2 bath home in Kyle.
What's more important to me? Is the house more important to me than the commute?
For some buyers, it's all about the house. or the size of the lot. If this is the case for you then you might not be as concerned about your commute. OR you think it's not as important to you until you're sitting in traffic night after night driving two hours to get home. Then suddenly spending two hours on your lawnmower mowing the 2 acres you absolutely had to have, isn't looking as good as it used to. So if you have a job that requires you to drive somewhere to work 5 days a week, we always, always, always suggest that before you buy a home you make the drive to and from the house to your place of work during the hours you would normally be driving. Some people think making the drive on a Sunday morning is enough, but trust us when we say, drive it when you would be driving it. Don't wait for the shock after you've already signed on the dotted line. If the drive is fine then great...proceed.
Another thing to check out is how is the neighborhood in the evening. Looking at homes during the day is great, but after you narrowed down your selection we suggest you drive by the home in the evening. You don't want to find out there are no parking spaces after 6 pm. Or anything else that might not be to your liking.
The bottom line here is that we find if a Buyer is unhappy with their purchase it is not usually because of the home itself. Many will admit to loving the home, but they found out that the location isn't working for them. Perhaps the commute is too long, or all their friends or family live on the other side of town, or they have to drive 30 minutes to the closest grocery. Whatever the case may be, ask yourself the questions before you make the purchase.
Keep your objectives in mind throughout the process
When visiting houses it's best to look at several. You want to get a real feel of the area, prices etc. And while it can be tough sometimes, keep your feelings in check. Try to be objective and keep your list of the features that you swore you needed and those you wanted in your home. Don't let the gorgeous granite counters sway you from the fact you said you had to have a room for a home office. After each home you check out, compare it to your list, did it check off the right boxes? Our job as your realtor is to help you stay on track.
Have you ever heard the term: "Lipstick on a Pig" Well...you want to avoid it.
Always, always always, (or almost always) get a home inspection. I come from the Midwest and there's an old saying that goes something like this: You can put lipstick on a pig...but it's still a pig. In real estate that means that sometimes you can walk into a house that has been all fixed up and fall in love with its cuteness. Your heart is getting tugged and all your objectivity is flying out the window. We're here to help remind you that it's critical to find out what's under all the paint and glam.before we right a contract. We'll find out how old the AC is? When was the roof replaced last? What are the utility bills averaging? We're not saying that it isn't the right house for you, but we want you to know what you are buying before you buy it. The price of a house is important, but so is getting an understanding of what the ongoing maintenance might be.
Contract to Close
We'll be there to help you decide what you want to offer. Is the house really worth $10 a square foot more than the other houses that sold in the neighborhood? (The answer could be yes, but you need to know why.) But once we've got the contract executed it doesn't stop there. We'll be by your side lining up the inspections, reviewing them, deciding what items you might need to ask Seller to repair. We'll be working with the lender and title company to make sure everything goes as smoothly as possible all the way up to the final walkthrough to make sure everything is still as it should be, then we'll join you at the title company where you'll be signing on the dotted line. We'll be as excited as you are when you get the keys to your home.
The bottom line is we'll be there for you
From the first interview that determines your requirements to the moment that you receive the keys, we can help you with the complicated process of buying a home. Don't hesitate to contact us to find out more about how we can make the home buying process easier!