Many real estate investors agree that purchasing a home is a great step toward a stable financial future. First-time homebuyers can find a property that is a solid future investment while meeting their immediate needs using four important criteria.
Real estate experts often recommend focusing on location first in terms of resale value. While it is a necessary consideration, a first home should also be appropriate for the homeowner’s lifestyle. For example, a property in a great school district will hold its worth, but young buyers without children may opt instead to live in less desirable neighborhoods that are closer to work or nightlife. Not only will they benefit from the lower price per square foot, they also potentially become early investors in up-and-coming neighborhoods.
Purchasing a house that needs extensive renovations will often come with a steep discount, but first-time buyers shouldn’t bite off more than they can chew in the hopes of turning a large profit right away. The smarter decision for younger folks with busy careers may be choosing homes that need cosmetic updates but don’t require costly repairs just to make the place livable.
Although banks often approve loans with payments that take up a substantial portion of monthly income, it is better to settle on what they feel financially comfortable paying each month. This way, there will be room in the budget for when unexpected repair or other expenses arise.
In some cases, a home’s potential can be more important than even the condition or location. For instance, having room to add on can turn a starter home into a forever home should the desire or need arise. Conversely, a row home in a crowded city restricts the size and layout changes but has the potential to become an attractive rental property.
For many, real estate is the largest purchase of their lives, and first-time homeowners need to weigh their options carefully to avoid costly regrets.