The first real estate purchase is definitely a milestone that deserves to be on the list. Buying your first home or property is an exciting step into adulthood, but it can be a daunting experience, especially if you don’t have a clear idea of what you want before you start your search. There are a few things to consider before starting your journey on the road to home ownership.
The first thing to be clear about is your plan for the property. Will it be a place you live and call home or a rental property where income generation is your main goal? Looking for a home with extra room to raise your family? Or are you single and have your eyes peeled for the perfect condo built for entertaining? Knowing the answers to these questions before looking at your options will make it easier to identify what you can and can’t live without. Be very clear about what you want so you don’t waste time looking at what you don’t.
Another important aspect to keep in mind when buying a property for the first time is the location. Many say it’s the most important, and as the old saying goes, “location, location, location” couldn’t be more true. No matter what you like or dislike about a property, you’ll keep coming back to what really matters: where it’s located and how that fits into your lifestyle. Things like school districts, neighborhood safety, and parks and recreation are top of mind if you have a family. For city-dwelling singles, proximity to cultural outlets such as museums, restaurants, and nightlife may be the deciding factor. Even if your intention is to flip your purchase, location is still the number one rule to live by. On a twist, you may want to consider a transitional area where homes are currently selling at lower prices, making it more accessible to buy and resell at higher prices. Two to three years of such real estate activity can change the location for the better and increase the value of the property.
Home ownership costs are yet another thing to keep in mind when considering buying real estate. Those who plan to rent out their property should plan to spend half of the income they generate on maintenance. As the owner and landlord, you are responsible for all maintenance and repairs, including fixing any utilities and paying property taxes. The cost of not only buying, but maintaining a home can be a huge financial burden and you should be fully prepared before moving forward.
Buying a home for the first time can be a daunting task, but if you’re clear from the start about what you want, what you need, and how you can afford both, you should be able to navigate the process with confidence.