Tips for First Time Home Buyers
Purchasing a home is one of the toughest, but dream investments in anyone’s life. Buying property for the first time requires a good understanding of several aspects like setting the right budget, deciding on the type of property, location, amenities, builder, and getting the home loan for our dream home.
Just like our first job, first salary and first date, buying our first home is also one of the most vital moments in our life. Buying a home on our own is not less than a dream come true for most of us.
However, purchasing a home requires a lot of meticulous planning and financial due diligence. Here are some of the tips for you to help you with the first time home buying process.
Get a fix on a budget
The very first thing in the home buying process that has to be done is fixing the budget.
It’s easy to fall in love with homes that might stretch your budget, but pushing yourself too much is never a good idea. With home prices trending upward, it’s important to stick close to your budget.
Prices of homes will differ widely depending on the type of property, location, amenities, builder and size, therefore it’s crucial to get a very clear idea of your budget.
You may be looking at a high-end property in a posh neighbourhood, but if it’s not in your budget, then it’s not a viable option. Not only buying a home you can’t afford can put you at higher risk of foreclosure if you fall into tough financial times, but it’ll also have less room in your monthly budget for additional bills and expenses.
Concentrate on what monthly payment you can manage rather than fixating on the maximum loan amount you qualify for.
Carefully review your finances — including your monthly income and debts — so you can get an idea of the budget to purchase a house.
Finally, remember you’ll be the one repaying the loan, and you don’t want to struggle with a bill you can’t afford.
Decide on the type of property
Finalising the property will depend on your budget. It’s you who has to finalise what type of house you want. Most of us living in the metro cities would prefer an apartment. Before coming to any conclusion, consider factors like the number of rooms depending on the number of family members, location, amenities and builder. Try to arrive at the best fit depending on your budget and your requirements.
Also, consider the purpose of buying a home, whether you are buying to live or it’s just an investment. If you are buying to live, then how long you are planning to stay are some of the aspects to consider. If you are buying for an investment, analysing the requirements of tenants and their tastes would be a good idea.
Focus on the location
Choosing the right location is an important factor when buying a house, especially in tier 1 cities where commute times can be long. Your work location, access to public transport, proximity to train or metro stations, and the distance of schools and hospitals from your house are some of the factors one should consider.
Other factors that you need to keep in mind is a safe neighbourhood and closeness to markets and retail stores. The budget will also play a significant role here as home prices vary a lot depending on the location.
It is important to decide on the amenities you are looking for. Nowadays apartment complexes are facilitated with swimming pools, gyms, party halls, kids parks, spas and clubs. Choose which amenities you want. For example, if you have little kids, a play area is a good thing to invest in. If you have your vehicle, you would need a garage or a parking lot. It is important to choose the amenities carefully as all these will add up to the total cost of your home.
Assess the neighbourhood
Vetting the neighbourhood before moving is one of the important steps in the home buying process.
Your neighbourhood and your neighbours play a critical role in your experience as a homeowner. Once you find a home you like, make sure to walk the locality & talk to people out in their yards, and get a feel for what the community is like.
Don’t forget to research the crime rates, school quality, neighbourhood amenities, and availability of public services. Having an idea of the proximity of things like your work, grocery stores, playgrounds, and other must-haves is important too.
Choose a reputed builder
Since purchasing a home is a big commitment, it is critical to check the credentials of the builder. Check the track record of the builder, and verify
the projects which they have delivered on time in the past.
You can also speak to existing customers and check on their experience with the builder regarding the construction quality and delivery of what was promised. Avoid fly-by-night builders with no track record who are making big and fake promises. If in doubt, a ready-to-move-in unit is the best to avoid any issues with the builders.
Select the right home loan
Since a house is a big-ticket investment, very few people can pay upfront for a loan. Therefore, it becomes critical to avail of a home loan. Talk to your existing banker, compare home loan rates and different features offered by several lenders.
Approval of the home loan is one of the most important steps when purchasing a house. A home loan also offers substantial tax benefits.
It’s best to keep your home loan tenure as short as possible. Cumulative interest payments for long tenure loans becomes too high.
For example, the total interest payment for a 25 year home loan is 160% as compared to 55% for a 10 year home loan.
Find a good home inspector
Onboarding a home inspector can be a good decision as they inspect the home, looking for any safety hazards or problems that need to be repaired.
You can then use the findings of the home inspector to renegotiate with the seller — asking them to make the noted repairs or give you the funds to do it yourself.
Getting a quality home inspection is critical to ensure you buy a safe, well-maintained property that’s worth the money you’re paying for it.
For a first-time homebuyer, the process of buying a home can be daunting. Nevertheless, following the above tips can help you plan properly and make your first home purchase an experience to remember.
In case, if you still feel daunted because of the process, then Bridl360 is there to assist you through the process. For a consultation, you can reach out to us at +91-9966696961!