If you’re a first-time homebuyer in the Gen Y or Z age group, congrats! You’re making one of the most significant purchase decisions of your life. This is an incredibly exciting time, but it can also feel overwhelming.
First-time homebuyers in the Gen Y and Z age groups need not worry. Here’s how you can rest assured that you’re making a sound investment and doing what’s best for your future.
1. Get pre-approved for a mortgage
This is one of the most critical steps in the homebuying process. Getting pre-approved will give you a clear idea of how much house you can afford and help you secure a reasonable interest rate on your mortgage.
If you’re not sure where to start, you can contact a mortgage broker. They can help you get pre-approved quickly and easily. Mortgage brokers can also help you compare different lenders to find the best deal for your needs.
2. Save for a down payment
For many first-time homebuyers, saving for a down payment can be one of the most challenging parts of the process. If you’re unsure how much you need to save, a good rule of thumb is to aim for 20% of the purchase price.
This will help you avoid private mortgage insurance (PMI) payments, and it will also give you some equity in your home from the start. If you’re unsure how to save for a down payment, you can talk to a financial advisor. They can help you make a savings plan tailored to your unique needs and goals.
3. Work with a real estate agent
An excellent real estate agent will be invaluable during your home search. They’ll be able to provide guidance and advice, answer any questions you have, and negotiate on your behalf when it comes time to make an offer on a property.
Moreover, a real estate agent will have access to the Multiple Listing Service (MLS), which is a database of all the homes currently for sale in your area. This is a great resource for finding properties that meet your specific needs and budget.
4. Do your homework
Before you start looking at properties, it’s essential to do your homework and research the different areas that interest you. Look up crime statistics, average home prices, nearby schools and amenities, etc.
This will give you a better idea of which areas are suitable for you and your family. Once you’ve narrowed down your search area, then you can start looking at individual properties. Moreover, it’s always a good idea to attend open houses in the area, even if you’re not ready to buy just yet. This will give you a chance to get a feel for the market and see what’s out there.
5. Consider your future needs
When buying a home, it’s important to think about your future needs as well as your current needs. Are you planning on starting a family in the next few years? Do you anticipate needing more space as your family grows? Are you likely to want to downsize once your kids move out?
Thinking about these things ahead of time will help you narrow down your search to properties that will suit both your current and future needs. It will also help you to avoid making a purchase that you’ll outgrow quickly.
6. Get a home inspection
Once you’ve found a property you’re interested in, it’s essential to get a home inspection. This will help you to find out any potential issues with the property before you make an offer.
You can hire a home inspector to carry out the inspection who will look for problems like structural damage, electrical issues, and plumbing problems, to name a few. If any major problems are found, you can use this information as leverage when negotiating the home’s purchase price.
7. Know your closing costs
When buying a home, there are a number of additional costs that you’ll need to be aware of. These include things like loan origination fees, appraisal fees, and closing costs.
Be sure to ask your lender for a good faith estimate of all the fees you’ll be responsible for so that you can budget accordingly. Additionally, many of these fees can be negotiated, so be sure to ask about that as well.
By following these helpful tips, you can start your homebuying journey with ease. Remember, buying a home is a big decision, but it doesn’t have to be daunting. With careful planning and a bit of research, you can find the perfect property for you and your family.