How to buy a house…or not

Remember when Hubs and I resolved? And we resolved to buy a house this year?

That was fun, right?

Well, I realized that we should probably start thinking about looking for a house sometime soon if we have any intention of buying in the semi-near future. After all, we don’t know anything about house-hunting.

After I realized this, I set out thinking about the best way to move forward. I didn’t come up with any good plans, so I set out to creating a list of things I don’t know but feel like I should.

Here goes.

1. How much can we afford to pay each month on mortgage when we also include taxes and insurance?

2. How do we figure out how much insurance and taxes will be if we don’t know how much we can spend?

3 When is the best time to start looking?

4. Should we use a real estate agent?

5. If yes, how do we pick which one?

6. If no, how do we figure out stuff like reading a contract?

7. Where do we start to look when I don’t know where my job will be?

8. How long should we wait to start looking?  …it could be years before I find a job I really want!

Clearly, we have a lot to learn.

 

P.S. I had an interview today. It went okay, but I don’t know anything yet. Also, I had to drive downtown by myself with very little idea of where or how I was going. But I made it. So, I’ll claim a little victory, at least, right?

To celebrate, I think I’ll make pumpkin smoothies. Especially since we’re also celebrating our anniversary a day late since I got called into work last night.

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15 thoughts on “How to buy a house…or not

  1. Hi! My husband and I are in the same boat right now! And it is so overwhelming – and at times quite frustrating. We have looked on and off for the past year, but only recently have gotten much more serious. I have heard of some people finding a house almost immediately, and others it takes them years to find the right one. One of our favorite sites to use is zillow.com. It lists houses for sale, but also lists all houses prices so you get an idea of the value of that area. It also has something that calculates what your mortgage payment would be, including taxes and insurance, depending on the amount that you put towards a down payment and the interest rate.
    To figure out how much you can spend, you need to look at your monthly income and expenses. A good start would also be to get pre-approved for a mortgage. It wasn’t too difficult, and it gave us an idea of what price range we should be looking at. I have been told to never spend as much as you are pre-approved for because it will really strap you for cash, and with houses there will always be something that comes up that you need to invest some money in.
    Right now is not the best time to be looking, at least here in Boston due to the weather. It’s an ugly time of year, so most sellers aren’t putting their houses on the market quite yet. Spring is the time to buy, but I am not sure if this is the same where you are.
    I would definitely get a real estate agent, especially as a first time home buyer. We started off by just driving around on weekends and going to open houses (you don’t need a real estate agent for that), and we got to meet some real esate agents. From that, we were able to narrow it down to a few agents that we were interested in having as our real estate agent.
    As far as knowing where to look, especially because you are in the job hunt – there is no easy answer for that. We ask ourselves that a lot. Renting, you can just pick up and move if you get a new job. A house, well thats a little more permanent and it is a little scary. We sat down and looked at a map and looked at potential job locations, and found a very central location. Another big thing to consider is the school systems for that town. While we aren’t having kids quite yet, eventually we will be, and we want to have our house be in a town that has a decent school system.
    There are so many different things that go into buying a house – I know because we are going through that right now. Sorry for the long post – I just feel like I am in the same boat and had a few things to share from our experiences thus far 🙂
    Wishing you the best of your luck on your house hunting!!

  2. There are lots of online mortgage calculators that will give you some idea of how much you are working with. To be sure, get pre-approved for a home loan. That way you know for sure how much you have to work with and if you find something you really LOVE, you can jump on it.

    Go ahead and look, looking is free! Find which part of the city you want to be in, drive around in the neighborhood, use realtor.com or zillow.com to start scoping things out, go to open houses.

    Make a list of things you must have and things you’d really like to have, and after you see a few, review the list to see if its changed at all. And the #1 rule for your first house (in my opinion), don’t set your expectations too high and be willing to have a little vision. There is something out there that will be perfect for you, it just may need a bit of TLC to make it home.

    Also, real estate agents know their areas well and they can be a great help in going through all the gunk.

    House hunting is fun so don’t be intimidated! Yes, its a big purchase, but its totally worth it.

    • Thanks for the advice! We played around last night with one of those calculator things but I don’t know if I felt it was entirely accurate so I’d like to take a few more steps to get started…
      I don’t want to rush it, but I also want to get started…
      I’ll let you guys know how it works out!

  3. My wife and I bought our first several years ago. I was a shockingly stressful process. When it was over I figured if our marriage survived that we could survive anything. Yes it was that bad. I would offer two bits of advice. Try to have some fun with it. Keep it light and dont be in a hurry. The right place will come along. We seached for nine months. Second I would get a broker. It doesn’t cost you anything. They split the commission with the selling broker. Ask friends, parents, coworkers, etc for recomendations, and then go talk to them. Unlike when selling I dont think you are under any obligation to stay with them so if after a few trips to look at houses you dont like them you can move on. I was looking for a very low pressure experience. I told our broker up front that after he showed us a house I didn’t need two phone calls a day for the next week asking if I wanted to make an offer. We found him on a friends recomendation and he repected they way we wanted to go about. When looking for recomendations it may be worthwhile to ask folks if ther were buying or selling when they used the broker they recomend. I liked the guy we used to buy with becuase he was very low key. That said when we sell I dont plan to use him becuase is was so low key. I wil be looking for someone more agressive then. Good luck!!

  4. Hey Melissa – this is a BIG decision so it’s normal to feel what you’re feeling. You’ve gotten some great advice so far. I would definitely start by asking around for a referral to a lender (or ask at your bank) and then get pre-approved before you start looking in earnest. It will help you resist the temptation to consider something you cannot afford.

    Yes, a broker is the same as a real estate agent. Get a referral for someone there too. Maybe not as much in this market, but when the market’s good, everyone and their brother is trying to sell houses part time, which means they probably aren’t as well versed as someone who’s done it full time for many, many years. You definitely want someone you can trust because when things get down and dirty, that’s the person you want on your side so you can ask questions. Whatever you do, don’t get sucked into using the same agent that’s selling the house as your agent. Both buyer and selling need their own agent (or need to know enough to go it alone).

    One of the things we learned looking, buying and selling our last house is that you’ll start to recognize catagories of houses that are either a good fit for you or not a good fit. Consider the following to help narrow it down (beyond price and neighborhood):

    – # of bedrooms (and why…minimum for us would be 3 b/c we both work at home…and it’s difficult to resell a 2-bedroom house)
    – # of bathrooms (and why…ideal for us is at least 2, because it’s easier for us and we like to have weekend guests)
    – do you need/want a yard?
    – have there been renovations? Are they cosmetic or core to the house? Sellers will often improve cosmetic things right before putting it on the market to better their chances of a higher price. That’s not a bad thing…just something to be aware of. If someone has done a big remodel and is trying to “flip” it you might have trouble making your money back when you resell.
    – what are your must haves and can’t stands?

    As far as timing, in general, spring is when people usually put their house on the market. But b/c that’s a known trend (and families generally want their move settled before kids have to start school in the fall) there are a ton of houses to choose from and you’re competing with more buyers. The “inventory” of houses is lower right now, but that also might mean you’ve got more motivated sellers to deal with.

    Observe DOM (or “days on market”) as that will often tell you how long they’ve been trying to sell. A real estate agent can tell you if it was listed before, when, and for how long.

    One last thing…when you get to the contract stage everything is negotiable. You might not get something you want, but it’s always worth asking.

    Obviously there’s a ton to know! Take the advice of some others who have said: just start looking/going to open houses. It will help you narrow what you’re looking for and give you things to think and talk about. And have fun! It’s an exciting and very educational process!

    • Wow! I’m so encouraged by how helpful you all are! We’re definitely in the early stages, but this is all good to know. We’ve started our “must have” list but certainly don’t have a major idea of what we’ll like.
      Thanks for the real estate agent advice, also! That was something we’ve debated, so this is great information!
      What great information!

  5. Laura

    I purchased my first home before I got married so I did it on my own. It will not be too much longer before my husband and I start looking for a new one together (currently have a townhome, would like a real house before having kids!) I had a realtor who was amazing and so was my mortgage lady. Getting preapproved for a mortgage is a great idea, they will also (if it is a good mortgage person) give you hints on how to make your credit better to get a better interest rate and also give you an idea of the size downpayment you should have to get the price point you are thinking about. My mortgage broker was fantastic and she helped me out in every way that she could, even she says you should never go for the highest amount you get preapproved for our you will more than likely wind up being “house poor” as she put it (as in Ramen noodles every night for dinner kind of poor). I told my realtor my price range, location and a few other things I was looking for and she helped me find the right fit for me. I was lucky b/c I found my house and was closed on it within two months of starting my search. I know this time around it is going to be a bit harder but I am looking forward to the house hunt, mainly because I was lucky enough to have a great first home buying experience. Also, for me and maybe it is just a state thing (NC) but my insurance and taxes are included in my mortgage payment so I do not have a seperate bill that I have to worry about for that which is nice. Good luck with the beginning of your hunt!

    • Thanks! How great to be able to buy your own home on your own! Hubs and I are certainly both learning this together so we have plenty to figure out! Thanks for taking the time to give us advice and encouragement!

  6. We bought our house two years ago, and I still remember all the stress that came along with it! We even fell in love with one house, only to find out it had been sold (or put under contract so we couldn’t put in a bid, or something like that) while we were walking through it!

    We used a real estate agent who we knew and went to our church. I’m really glad we did because we were walked through each step very thoroughly.

    Good luck! And I hope you find the house of your dreams (or one you can turn into the house of your dreams) 🙂

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