First-Time Buyers

December 28, 2017

First-Time Home Buyer Tips from a Former First-Time Buyer

Carrie Stone

Mortgage Banker

In my early 20’s – living in my first apartment and working my first job – I would turn to my parents for advice on all the grown-up things I was supposed to be thinking about. Retirement planning, homeownership, career. With regards to investments, my Dad advised me to “just get in. ”  There was no way to benefit from the real estate or stock markets without participating, he reasoned. There was a lot to lose standing on the sidelines. So, my husband and I did our research, shopped around, and decided to buy a small single-family home on a great block in a solid neighborhood. But, now what?

Home is an investment that can really pay you back. Many intangibles are associated with home – a place to gather, grow, join a community, and build a life. All fine things in which to invest. The financial investment in a home can come with a great return, as well. It is a proven engine for building long-term wealth. But much as your relationships with friends and family need your attention, so does the physical structure underlying your home – your house and the land upon which it stands.

If you buy into a property with shared common elements, such as a condominium or townhome, a homeowner’s association is established and funded to provide for maintenance and repair to things like the roof and parking lot. A budget is drawn up for monthly expenses and a reserve fund is established to provide for unplanned expenses. Occasionally, the HOA will call a special assessment to fund a needed property improvement to maintain safety or improve aesthetics.

Single-family homeowner’s can take a page from the HOA book. When deciding how much home you can afford, in addition to the Principal, Interest and Taxes, you should calculate what you expect to pay for regular maintenance, emergency needs, and improvements. When you deploy your cash toward the down payment, determine an amount to set aside and fund this “Home Care” account at the time of purchase. Then, take that next step and arrange for direct deposit each month into this account. I promise, you won’t regret it.

If you purchase a single-family home, the great news is there is only one person who votes on how these funds are spent – YOU. Your wise choices with regards to home maintenance and improvement can bring forth that old truism, “you get out of it what you have put into it” – and then some. Contact me for answers to any home buying questions or for help determining how much house you can afford.

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