Monday, August 17, 2015

Buying Your First Home // Expectations Vs Reality (& Giveaway!!)

The home buying process can be a somewhat daunting and overwhelming task for the first time purchaser. There are a plethora of pieces to this puzzle that we deem the home buying experience and if you are not sure what you should be searching for, you very well may stumble along the way.

Now we all dream of that perfect house, with the exact amount of needed bedrooms, in just the right neighborhood, with every bell and whistle required for daily living. However, sadly this is not the case and can seriously exhaust you if you continue down the path of rigidity within your 'Must Have' List. So here are some great tips if you find yourself in the middle of the home buying process or perhaps know this is where you life is headed in the near future.

So I already touched upon this early on, but an exhaustive 'Must Have' list may leave you short or possibly even searching for years.

Expectation: You will find every lat item on your list, in the perfect neighborhood, for the perfect price.

Reality: There is a slim chance you will hit every single detail on your list, neighborhood, price, the whole shebang.

Your best word for this home buying experience is going to be this....Compromise. I know that so many people do not want to hear it, but need to understand that compromising on some of the 'Must Haves' is absolutely key to settling in a new home. Our culture has taught us that we can have it our way and receive it in a minute or less, but that is just not the case, as your searching the listings. It's going to take time and compromise.

My best piece of advice is to redesign your list, reeeeally make a list of things you absolutely CAN NOT like without, and then try to fulfill those. Safe neighborhood, must have! Granite counter-tops, not really a must have.

In building off of this expectation, also realize that cosmetics can always be changed along the way.

Expectation: The new house must have every cosmetic touch you are searching for, if you are going to purchase it.

Reality: Seeing the home for the potential that it has, not only helps you to not miss a gem that you are standing in, but also allows you to customize it as time goes on. 

Say the home you are touring is in a great school district, has the perfect amount of space, but no granite. This is not a deal breaker. If you can look at that home for the potential it is encompassing, then it'll be easy to move in, and then purchase new granite counter-tops later on (the ones you actually appreciate). And remember, there's nothing worse than seeing a house that has those expensive upgrades, and then you don't even like what the previous owner picked. This allows you to customize to whatever it is you are looking for.

Next, it is so important to remember that just because you were approved for a specific loan does not mean that it is in your budget.

Expectation: You were approved for a loan of X, so you can purchase a home for that amount.

Reality: If you purchase a home with your loan approval money, but it is not actually in your budget, you will bankrupt yourself or become house poor.

Thank you Jesus for my incredible husband, because he taught me such an important financial lesson in our home buying search. When the bank approves you for a loan, they are simply letting you know that, due to your credit score and income, X is the amount of money they trust you with as a loan.

The kicker is, if you have extremely great credit and make a decent living that number will only grow to an outlandish amount. The very best thing that you can do for yourself, is to sit down and budget what you wish to spend monthly. Make a cap to that limit. Then do the math for over a 30 year period to see what the highest you're going to want to spend on a home actually is. Now that number could easily change when you switch towns (thus changing your tax levels) so always be sure to recalculate, with the taxes included, in each town. 

By making sure you follow your monthly budget for payments, instead of the loan amount approved, you will save yourself from becoming extremely house poor after the purchase is complete.

When searching for your first home it is always important to remember that a first home is rarely a forever home.

Expectation: You need to get everything on your list when you are searching so that you never have to move.

Reality: You will most likely move multiple times throughout life, so don't over stress if this is not where you are going to be forever.

Josh and I chose to buy a home instead of rent when we got married, so that we could create some equity and invest our money into a space. This is not our forever home, and we pretty much knew that going into the process. So we were able to make some adjustments in our minds for our expectations right off the bat.

First and foremost, we purchased a home that is not in the best school district. But since we are newlyweds without any children, for our first home, that didn't really matter. It also allowed us to purchase in a lower tax area, therefore saving us money each month on what we had originally planned out for our monthly budget. Finally, a ten year investment into this home, plus our savings from lower taxes, will allow us the finances to go all in on our forever home. Compromising on an area for a specific amount of time, can help invest into your future down the line.

Finally, always remember that creating a home is a process.

Expectation: Things will be move in ready, you'll unpack the first week, and have your house warming party by that weekend.

Reality: It could take you months, even years to create the perfect home. It's a marathon, not a sprint.

I love being able to show pictures of our home design process, but what is super important to realize is that we purchased this home two years ago. These spaces and pictures did not come together over night. They where a loooong process. Take your time, learn your style, and add little touches as you go. No one's expecting your home to be perfect from day 1. Enjoy the journey. And seriously, take pictures along the way. It'll help you realize how far you've come in the end. 

I truly hope some of these tips were helpful for you in your home buying experience. Remember, at the end of the day, a house is a home because of the love that resides inside of it, not the color of the counters. When you enjoy the process of purchasing, it makes you fall in love with the space you are creating that much more!

Are there any tips that you have found from being a first time home buyer that others could find useful?

Now for the giveaway!! I'm teamed up with some incredible ladies to give one lucky person a shot at winning a $45 gift card to Starbucks! Perfect for those back to school study nights. It's super easy to enter. Just check out some of these incredible blogs on Bloglovin and start following some amazing writers for your chance to win! Good luck!!

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