Top 5 things to know before buying your first home

Embarking on the journey to buy your first home is an exhilarating experience, but it can also be fraught with uncertainty and stress. To help you navigate this significant milestone, we've compiled a list of the top five things you should know before making this monumental decision.

### 1. Understanding Your Financial Readiness

Before diving into the home-buying process, it's crucial to assess your financial situation. Start by examining your credit score, as it will heavily influence your mortgage interest rate and loan approval. Aim for a score above 700 to secure favorable terms. Additionally, calculate your debt-to-income ratio (DTI) to ensure you can comfortably manage monthly mortgage payments along with other existing debts.

You'll also need to save for a down payment, which typically ranges from 3% to 20% of the home's purchase price. Don't forget to account for closing costs, which can add another 2% to 5% of the home's price. Having a clear understanding of these financial requirements will set you up for success.

### 2. Researching Mortgage Options

Not all mortgages are created equal, and understanding the different types can save you thousands over the life of your loan. Fixed-rate mortgages offer stability with consistent monthly payments, while adjustable-rate mortgages (ARMs) might start with lower rates that can increase over time.

Government-backed loans like FHA, VA, or USDA loans often come with lower down payment requirements and more lenient credit criteria but may include additional fees or insurance premiums. Consult with multiple lenders to compare offers and find the best fit for your financial situation.

I typically recommend reaching out a lender for a "pre-purchase" phone call, to discuss your current financial situation, and find out what steps you would need to take to be in the best financial position to purchase a home in the future. It is best to make this phone call as soon as you are considering purchasing, and complete a follow up call once you are about 2 weeks out from meeting with your realtor to tour homes to have the most up to date rates/ information. 

### 3. Choosing the Right Neighborhood

Location is one of the most critical factors when buying a home. The neighborhood you choose will impact your quality of life and long-term investment potential. Consider factors such as proximity to work, schools, public transportation, shopping centers, and healthcare facilities.

Take time to visit neighborhoods at different times of day to get a feel for traffic patterns and noise levels. Research crime rates and community amenities like parks and recreational facilities. Speak with residents if possible; as their insights can provide valuable information that statistics alone cannot convey.

An often overlooked fee is the neighborhood's HOA fee, that changes with each community. It is important to know how much the annual fee is, what all is included such as amenties, trash, water and additional items. While searching, it is also important to keep a lookout for the community's given tax rate, as higher rates are often seen in newer constructed subdivisions. 

### 4. Home Inspection: Don’t Skip It

A thorough home inspection is a very important step to consider when purchasing a property. This step helps identify any potential issues that could require costly repairs down the line, such as structural damage, plumbing problems, or outdated electrical systems.

Hire a qualified inspector who will provide a detailed report on the property's condition. Use this report to negotiate repairs or price adjustments with the seller if significant issues are found. Skipping this step might save money upfront but could lead to expensive surprises later on.

Consult with your realtor to discuss which home inspection companies are recommended within your area.

Located in Cypress, I highly recommend reaching out to the following: 

1. Sunbelt Inspections, Phone: 281-964-9798

2. Bryan & Bryan Inspections, Phone: 843-258-6717

### 5. Future-Proofing Your Investment

When buying your first home, think beyond your immediate needs and consider how well the property will serve you in the future. Are you planning on expanding your family? Will aging parents need to move in? Is there room for growth if you decide to work from home permanently?

Look for features that add long-term value, such as extra bedrooms, flexible living spaces, or energy-efficient appliances. A home that meets both your current and future needs will be a more satisfying investment over time.

While searching for a home, it is important to take the age of the home into consideration. When purchasing a newly constructed home, typically buyers will receive different warranties from the builder, in comparison to purchasing resale. When purchasing older modeled homes, it is important to take the age of the HVAC, roof and plumbing into consideration to account for additional replacement costs, in the event of their failure. 

### Conclusion

Buying your first home is an exciting venture filled with numerous considerations and decisions. By understanding your financial readiness, researching mortgage options, choosing the right neighborhood, insisting on a thorough home inspection, and future-proofing your investment, you'll be well-equipped to make informed choices that lead to a successful purchase.

Remember that this journey is not just about finding a place to live but securing a foundation for many years of memories and growth. Take your time, do your research, and trust in the process—your dream home is out there waiting for you!

Blake Broussard, Realtor

Cy Fair Real Estate

713-409-5878