Going house hunting for the first time can be exciting. You are leaving the money-wasting world of renting behind and embarking on owning - and creating - a home you can call your own. It is also an eye-opening experience, one for which a lot of new homeowners aren't prepared. It can be frustrating, exhausting, and sometimes even heartbreaking. Putting your fantasies aside and facing reality will go a long way to helping you remain resilient while looking for a home you can love. Here are five common first-time homebuyer hopes and expectations that don't match up with reality.
1. You're Going to Find the Home of Your Dreams
Thinking you're going to find the home you have always dreamed of as a first-time home buyer will likely end in disappointment. Many first-time buyers have ideas of perfection that don't correlate with their budgets such as searching for large (i.e., expensive) homes instead of starter homes. It is a good idea to determine your priorities. Do you really need three bathrooms? Will a one-car garage work instead of a two-car garage? You might want to consider concentrating on your ideal neighborhood rather than your ideal home. You are much more likely to be happy with your purchase if you are living in an area you love as opposed to loving your home and hating your neighborhood.
2. You're Going to Get a Deal
Getting a great deal on a house depends on a number of factors. Is it a buyer's market or a seller's market? Is the house move-in ready or does it need work? Are the sellers getting other offers, or has the house been on the market for an extended period of time? Put simply, a house typically sells for less than asking only if other buyers are passing it by, and there is always a reason for that. And if it is a seller's market, meaning there are more buyers than properties for sale, expect homes to go for asking and even more.
3. Fixer-Uppers are Fun
In 2019, 60 percent of house hunters polled said they were open to buying a house that needed work, according to Realtor.com. But the plethora of reality shows centered around house flipping gloss over how time-consuming, stressful, and expensive home renovations can be. If you are looking at a house that needs work, hire a professional contractor to give you an estimate of the labor and money involved before making an offer. Underestimating this will be the beginning of a nightmare. 1Additionally, explore the different mortgage options available for fixer-uppers, says Nerdwallet. Going the route of a traditional mortgage can mean paying for repairs out of pocket.
4. You've Got Time
Making rash decisions is always a poor idea, especially when it comes to making one of the biggest purchases of your life. However, it does pay to be decisive. When you find a house you like and that works for your needs, moving quickly could mean the difference between putting in a winning bid and losing out. This goes triple if you are buying during a seller's market, where houses sometimes sell the same day they are listed. Your buyer's agent (you have an agent, right?) has the inside scoop and will tell you if the house you are looking at already has potential buyers interested in it.
5. Building Is a Simple Alternative
Is building a home your backup plan if you can't find what you're looking for? That's definitely an option, provided you are being practical about how much money and time that involves. 2According to Bob Vila, building a home from scratch takes an average of seven months. It can take less time if you go with a spec or tract home, or it can take longer if you are building a custom home. Plan on living somewhere else while construction takes place, and anticipate delays. Building a house can be significantly affected by weather, supply-chain issues, and labor issues. You can pull it off, though, if you have patience, resilience, and a different roof over your head during the build.
It's easy to look at the home-buying process through rose-colored glasses when you are buying for the first time. But, as with anything, experience and knowledge dispel the fantasies and prepare you for reality. In the end, you will likely find a home you love by setting priorities and having realistic expectations.