Expert Advice about Buying Your First Home
For many young families, their first big decision is often when and where to buy that first home – a daunting but thrilling experience. Coldwell Banker Preferred real estate agents Phyllis May Lynch of Media and Matt Donnelly of Conshohocken have helped many first-time buyers make this decision, and here are some of their recommendations:
- Don’t purchase above your comfort level. Make a clear-eyed financial analysis of what you can comfortably afford and stick with it. “Don’t over-extend yourself,” Lynch advises, “and make sure that monthly ‘nut’ is something you can handle.”
- Carve out a place in your budget for monthly payments. Usually most families identify an income source or part of it that is earmarked every month for mortgage, taxes and utilities.
- Evaluate your salary and income prospects for the next five years. Donnelly says a frank analysis of job security and potential advances for both partners is crucial before pulling the trigger.
- Balance time versus money. Most things have tradeoffs, and sometimes an inexpensive location may not be the best location. “You should calculate drive time to your job, your sitter and other commutes and see if the time spent is worth the cost savings,” Donnelly advises.
- Think about future family growth. How many children you plan may dictate whether this first residence should be a starter home or whether you want space for future family “additions.”
- Choose the right school district. “Unless you’re planning private schools or home schooling, this is often the first question first-time buyers ask,” Donnelly says.
- Examine the tax implications. Lynch reminds, “A location with high property taxes can have huge implications on your monthly qualifier.”
- Analyze square footage and layout. As your family grows, will your house be big enough to accommodate the expansion? For example, an unfinished basement might help supply the answer. Donnelly points to the importance of bedroom and bathroom placement. “Where you want a toddler to sleep may not be where you want to have a teenager,” Donnelly says.
- Insist on a home inspection before buying. “I’m adamant about this,” Lynch says. “No matter how new or good a house looks, an inspection now can save a lot of problems later.”
- Waiting may lose you money. “Sometimes people say, ‘I’ll wait another year,’” Lynch says, “but often the planned savings go elsewhere, and meanwhile the interest rates go up.”
- Don’t forget resale implications. “Even if you’re buying a house for the long term,” think about how long is long?” Donnelly asks. Nowadays, few people stay in their first home their entire life. Questions to ask: How many “good years” does the house have before a major re-do? Is the neighborhood getting better or declining?
- Buy the worst house on the block, Lynch advises, as opposed to buying the best. The idea is that as the prices of the homes around you rise, your house becomes the one newcomers can afford while you’re still making a profit. “Always analyze comparative sales in your neighborhood,” she says.
To seek advice and assistance in buying that first home, talk to a Coldwell Banker Preferred agent in your neighborhood by logging on at cbpref.com.This is a paid partnership between Coldwell Banker Preferred and Philadelphia Magazine's City/Studio