3 Important Things All First Time Home Buyers Need To Know

When we bought our first house back in 2012, we had very little idea what we were getting into. There are certain things that first time home buyers need to know.

Whether you’re looking at a fixer upper, an older finished home, or a brand new spec home, there are a few common things you need to keep in mind.

Let’s jump right in.

3 Important Things First Time Home Buyers Need to Know

Do you have a good realtor? If so, they’ll back us up on these.

#1 – Don’t lowball owners of homes you can’t afford

Basically, to take it a step further, don’t LOOK AT homes that you can’t afford.

If the market is a buyer’s market, you’ll have a little wiggle room. Make sure to inform your agent what your budget is, and reach out often to get their opinion on homes you find that might be a little over budget.

If the market is hot (or a seller’s market), you’re going to want to look at homes quite a bit UNDER your budget to account for bidding wars or you’re likely going to lose every house you get attached to.

Low-balling gives you a bad reputation. Realtors (and sellers) remember buyers who do that. There’s probably a good 10% chance you’ll get lucky and snag a house you like, if the owners really need out of it. However, if you don’t, or your deal falls through, you’re not going to want to work against that reputation.

Now, that’s NOT to say that you should pay out the wazoo for a house not worth a fraction of what they’re asking.

First Time (and any time) Home Buyers need to do a cost assessment:

• Are there any needed repairs? (Roof, foundation, windows, siding, basement, furnace, hot water tank, etc.)
• Are there any needed updates? (Kitchen, bath, flooring, cleaning, etc.)
• Do I need to invest in anything to make it more comfortable/livable for my family? (whole house water filtration, garage addition, etc.)
• Can I afford the mortgage + insurance, taxes and PMI (if less than 20% equity)?
• Can I see my family growing into the house or will we need to move in a few years?
• If so, will I have enough equity in this house if I sell it in __ years?

Some more great questions to ask:

• Can I add equity to the house?
• Can I do the work?
• If not, will hiring someone who can do the work actually add equity?

Fixer uppers can be worth the work, or they can be an endless money pit.

Our third fixer was originally listed for $125k. By the time we found it, it had been listed for a year and had dropped to $99,900.

This house was extremely run down, hadn’t been cleaned in probably decades, the carpet was filthy, old and matted. All the walls had so many layers of dirt and grease and who knows what else. It would NOT scrub off and we ended up painting over it. It was gross.

The massive front porch and stairs had no top/floor. The roof was in need of immediate replacement, the gutters were bad, the siding was missing in places all over the house and covering up years of massive rot. All windows were ancient and the upstairs windows had black mold behind the screens.

The last ‘update’ to the house was probably in the 60’s/70’s. Kitchen cabinet doors were falling off and appliances were old and/or broken.

It was built before 1875 (that was when the records ‘began’ for our area and it was built before then), and the bones were still good.

We paid 90k for it.

You need to do the math on how much the repairs are going to cost and go from there.

Sometimes sellers/realtors price WAY too high in hopes of an ignorant buyer. Those are the ones that either work with you to make the sale or stay on the market and never sell.

Basically, if they are priced well with other comps in the area, you might be able to move a bit, but don’t ruin your reputation by expecting them to gift you their house.

#2 – Don’t be embarrassed to bring an older, wiser adult with you

I’ve known many a friend who was afraid of what their realtor would think if they brought a parent with them.

Guys! You’re the one/s signing your name over, promising to make on-time payments on this house for the next 15 or 30 years. You do what is necessary to make sure it’s the smartest decision for you to make.

PLEASE don’t discount the wisdom of bringing someone older and wiser in the home-ownership game with you to showings.

We brought my husband’s parents to every house we bought BEFORE we bought it. And to many in between.

My father in law is a jack of all trades, like my husband, and they’ve worked on many a car, tractor and house project together. He was able to look at the bones of the house with us and point out things we might’ve overlooked. And Mom brought another design perspective and reality check.

We’ve passed up many houses with their input. But because of that input, we’ve had THREE solid, safe houses that we loved.

#3 – Pay for the inspection, but don’t expect perfection

If you don’t have a knowledgeable parent or friend who can look at the bones of the house and tell you if there’s something seriously wrong, definitely pay for the inspection.

HOWEVER, unless this is a brand new, just built, never lived in house, don’t expect perfection!

The house inspection on our last house was laughable.

First off, it was built in 1930 and, even though it was only 1300 sq. ft, it had at least two separate additions. The inspection company listed close to 100 things ‘wrong’ with it.

Several listed:

• Caulking missing around an old window
• Debris in the gutter
• Common cracks or nail pops in the drywall
• Rust/corrosion present on pipes (remember, house built in 1930)

Anyone who has been a home owner for any length of time understands those things come with the territory.

If you’re going to expect the current homeowner to ‘correct’ all those things, you’re 99% likely to lose the house.

Wait till you can afford a new home and then still do the inspection. If there are things listed wrong with a brand new home, you’re on much better footing to get them corrected.

If the builder doesn’t want to repair things that are moderate to severe issues, PASS UP THE HOUSE.

Recap of Things First Time Home Buyers Need to Know

1. Don’t lowball owners of homes you can’t afford
2. Don’t be embarrassed to bring an older, wiser adult with you
3. Pay for the inspection, but don’t expect perfection

It can be scary to be a first time home buyer. (That’s where the older, wiser adult comes in).

More often than not, it’s a good idea and a good investment to buy a house. Just make sure you are making wise decisions and have some wise people in your corner. And enjoy the ride!

Comment below if you have any questions or pointers to add for our First Time Home Buyer readers!

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