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  • Writer's pictureMatthew Wolfe

3 Things to Do and One Mistake to Avoid For First Time Home Buyers

Do: Your Homework! Find a Realtor That's a Perfect Fit.

A realtor will make or break your home buying experience. You need to find a realtor who matches your style of buying. Don't be afraid to call several realtors and treat it like an interview. They are, after all, working for you (for a short period of time). Do you enjoy window shopping Zillow for homes? Do you have an idea in your head of what your home will look like? Does that house have a wrap around porch with a waterfront view and a rotunda room for reading your favorite books? (Okay maybe I'm just projecting my perfect house on you, sorry readers) If you're nodding your head yes to any of those questions, odds are you are a hands-on buyer. Regardless of what type of buyer you are, you'll want to ask a realtor questions to determine if they are a good fit. Questions like, "What does the buying experience look like for your clients?" or "What's your background in real estate?" (important for me as an investor, I look for a realtor who is also an investor or who has experience working with investors.

Don't: Go Home Touring Without An Expert

This is especially important if you are a first time home buyer. I wish I could go back in time and yell this advice through a megaphone to myself. I was armed with nothing more than hours of HGTV and some woodworking skills when I bought my first house in Detroit, Michigan. I knew that cracks in a foundations were bad and that renovations, no matter how extensive, only took 30 minutes with time for commercials. So, I bought the worst house on a great street and lived happily ever after. Oh no, instead what I had was a multi-year project home that ate up my entire budget in the first 24 hours. But that's a story for another time.

Do: Phone in an Expert or Better Yet, Bring Them With You To Your Tours!

Now for the good news, every house is a learning experience and adds valuable skills to your toolbox so fear not. Even better news, you're about to learn the solution to not having experience buying a house. It's simple, find someone who does and bring them with you on your home tours. What if you don't have any friends or family who are electricians/plumbers/contractors? Remember those questions you need to ask your realtor? Find out if they have owned properties or done extensive renovations. Now you've got a second pair of eyes who can help you steer clear of money pits.

Source: (B. Jordan / Unsplash)

Do: Make a Budget and Stick To It

Julia is constantly talking me down from the ledge when it comes to budget. I see a property that "has so much potential" or "could be a great money maker if we turn it into an Airbnb" and the reality is that while those could be true, I'm looking at a hail-mary versus a lay up. The number never lie. Before you start looking at houses, look at your finances and figure out what your absolute top line is. No matter how great a home may be, the fun will quickly fade away when you're struggling to make payments. The golden rule for buying a home is the rule of 32. Your monthly total home payments (mortgage, interest, HOA, etc) should not exceed 32% of your gross monthly income. For example, if you bring home $4,000 a month, your home payments should not exceed $1,280. With 20% down on a house, that means you can afford a home up to $240,000.

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