Your first real estate purchase is certainly a milestone worthy of being on the list. Buying your first home or property is an exhilarating step in becoming an adult, but it can also be a daunting experience, especially if you don’t have a clear understanding of what you want before you begin your search. There are a few things to consider before beginning your journey on the road to homeownership.
The first thing to be clear on is your plan for the property. Is it going to be the place where you live and call home, or is it destined to be a rental property where generating income is your main goal? Are you looking for a home with extra room to grow your family? Or are you single and are just keeping your eyes peeled for the perfect condo made for entertaining? Knowing the answers to these questions prior to looking at your options will make it easier to identify what you can and cannot live without. Be very clear about what you do want so you don’t waste time looking at what you don’t.
Another important aspect to keep in mind when purchasing property for the first time is the location. Many say it’s the most important, and as the old adage goes, “Location, location, location,” couldn’t be truer. No matter what you love or hate about a property, you will continue to come back the all-important factor of where it’s located and how that fits into your lifestyle. Things like school districts, neighborhood safety, and access to parks and recreational areas will be top of mind if you have a family. For city-dwelling singles proximity to cultural outlets such as museums, restaurants, and nightlife may be the deciding factor. Even if your intent is to flip your purchase, location is still the number one rule to live by. With a flip you might want to consider an area currently in transition where homes are priced at the low end, making it more attainable to purchase and re-sell at a higher price. Two to three years of that type of real estate activity can change a location for the better and drive up a property’s value.
The expense of owning a home is yet another thing to keep in mind when thinking about purchasing real estate. Those who are planning to rent their property should also plan to spend half the income it generates on upkeep. As the owner and landlord, you’re responsible for all repairs and maintenance, including fixing any utilities, as well as pay property taxes. The expense of not only purchasing, but maintaining a home can be a big financial undertaking and you should be absolutely ready before moving forward.