Buying our first house ...

[Hiro]

I know I read at a topic like this quite a few months ago, but an extensive search turned up nothing. Anyway, does anyone have good Christmas advice for two crazy kids looking to buy their first home?

That is, advice other than 'Don't buy too much house, you don't want to be home poor,' and 'Don't get an ARM.'

 

[pallister]

As they say, it's all about location, location, location. The most important thing, especially if you have a family, is to make sure you buy a house in an area you're comfortable with. Also, if it were me, I'd buy a house with a landscaped yard of stones so I never had to mow the lawn.

 

[Kid Bro Sweets]

I'd pay careful attention to how water runoff is handled. If water rolls toward the house, I'd seriously consider walking away. Water problems are among the most difficult to mitigate.

I'd also pay attention to kitchen size. When people come over, the conversation often ends up in the kitchen. You need some space.

 

[Football_Bat]

Owning > renting. Especially now with all the foreclosures. In a lot of areas, home prices are tanking, while house/apartment rental costs are spiking. That's because folks who've been foreclosed-upon need a place to live and are flooding the supply of rental housing.

With home prices bottoming out, this is an ideal time to buy ... if you can get a mortgage at a good rate. It's all about timing. I bought at a time (almost 4 years ago) when mortgage rates hit rock bottom. Interest is a much bigger moneysaver over the life of a 30-year loan than the purchase price of a home.

 

[Angola!]

If it's an older house have them really inspect the roof. I was told my roof was good then my insurance company suddenly decided it could no longer insure it and when I sold it, I got hosed out of 15k of profit so the bastards, and the ex-wife of course, could replace the roof.
I've driven by there and they haven't replaced it, though I don't know who is insuring it.

 

[trifectarich]

I'll second the thought from Football Bat: It's a GOOD time to buy. Therefore, don't be afraid to start your offer at the bottom. In the right kind of scenario, people are having second thoughts about holding onto property they really don't want.

Yes, get a thorough inspection and don't back down on certain issues, like roofing, plumbing and anything that's structural. Try to imagine what the neighborhood is going to be like in 10 years. Living in an area with outstanding schools is great for resale value.

If you think you want to get a fixer-upper, don't think it's as easy as all those shows on HGTV. It can be a royal pain if improvements aren't done properly.

Good luck.

 

[Cadet]

Never been through the process, but my cousin the architect always preaches hiring your own inspector, someone who will give you an accurate assessment of the foundation, roof, etc. so you don't buy a deficient property.

 

[leo1]

go on line and look up the map that shows sex offenders in your neighborhood, especially if you plan on having kids.

 

[Idaho]

I will agree with others. The ~$250 you spend on a home inspection is among the best money you will spend on this purchase. Be thorough and do not be afraid to ask the seller to fix/change/repair anything you don't like.

Also, ask yourself where you want to be in three years, 5 years and 10 years. Factor those goals with your home purchase. Don't buy a home you don't want to be in three years from now if you intend on staying in the same town -- you don't want to be on the other side of the buyer/seller equation in another potential 'buyers' market.

If this is a true long term committment and you can squeeze a few hundred dollars out per month, opt for the 15 year loan and you'll save tens of thousands of dollars in interest.

Kids? Shop for schools, churches, shopping, mass transit and what types of developments may or may not be there in a few years. Ring the doorbells next door and a few doors down and interview your future neighbors about the area.

There are soooo many things to look at and discuss. But take your time, double or triple check everything about the house before you sign away 15-30 years worth of financial committment.

 

[93Devil]

Never buy the best house in the worst neighborhood.

You see people on the street with Rebel flags on the porch or blinging rims and thumping music, know that they will divide and multiply into other homes faster than you can say HOA.

Check out if traffic backs up on your daily commutes. Be sure to check at 7:30 a.m. and at 5 p.m.

Do not blow everything on the house's down payment. There will be bills once you move in to the house.

The layout of the house will never change. Carpet, paint and appliances will.

If you live in a hot climate, take note of how much direct sun exposure you are getting.

Look at least 10-15 different houses before choosing on one.

Ask the electric company what the prior utility bills were for the house.

If you have an attic, see if you can easily finish it. Is it weight bearing or already wired for electric.

Good luck. This is an exciting time for you.

 

[User 1019]

Good advice, here. Lots of folks don't like him, but I listen and follow his advice, and it has worked for me and mine. Dave Ramsey, a Nashville-based financial counselor with a fairly decent sized following, recommends a 15-year fixed mortgage through which the payments are no more than 25 percent of your take-home pay. That leads to less house, but more wiggle room when Mr. Murphy comes knocking. And he will.

 

[BigSleeper]

I agree that the inspection is key. Ours did a pretty good job, and we got a brand-new roof out of it.

As for financing, I'm no whiz on that, especially in the current climate. Our financing came in two forms, the larger part on a five-year ARM and the smaller portion on a fixed. I can refinance without penalty in another 18 months, which I'm already preparing to do.

 

[93Devil]

Financing...

fixed fixed fixed

Also, do not use everything that you are apporived for. That is the most they will give you, and if they gave you $100 more they felt you could not afford it. Why take it all?

Wife and I only used about 65% of what we were approved.

 

[Angola!]

Financing...

fixed fixed fixed

Also, do not use everything that you are apporived for. That is the most they will give you, and if they gave you $100 more they felt you could not afford it. Why take it all?

Wife and I only used about 65% of what we were approved.

I second the fixed. Some relatives of mine are in a bit of trouble because of a loan they got through Country Wide that keeps increasing all the time. And, like 93devil said, don't use all of the money you are approved for. It is a bad idea.

 

[FileNotFound]

Another vote for fixed rate, even if it means you're getting less house.

Read EVERY WORD of EVERYTHING you sign. Seriously.

To increase your confidence: Now is a great time to be buying a first house. Some great deals out there, at least in my part of the country.

 

[Baron Scicluna]

Don't forget, once everything is signed, and Moving Day is finished, to just take a quiet moment, sit back, and congratulate yourself on reaching one of life's biggest milestones.

 

[proudpittsburgher]

I second comments about the neighbors. We had a convicted sex offender and all around jerk living right next door to us, and never knew. Nice neighbors make a home much better. Not to mention it makes it very hard to resell if four houses in your neighborhood are for sale, i.e., there must be a reason. And I can't agree enough about fixed mortgages.

 

[finishthehat]

I know I read it on this board, but I forget who said it: Don't buy on a yellow-stripe road.

But don't take advice from me. We've brought two houses, rented another, and the first time I saw any of them was the day we moved in. There's fewer things I hate more than house-hunting, and I can basically live with whatever the final result is, so I let my wife have all the fun.