Life is full of exciting firsts. Your first steps. Your first day of school. Your first love. Your first job. Your first place.
Whether you want to move out of your parents’ home for the first time, own a home after renting for years or buy a place with a spouse or partner, purchasing your first property is a big step. It takes a lot of preparation when you’re in this stage of your life, and a little luck never hurts.
HOW YOU KNOW IT’S TIME TO BUY YOUR FIRST HOME
When you learn to drive, most states allow you to get a learner’s permit at age 15. Any teenager thinking of joining the military knows you can’t enlist until you’re 18, or 17, with parental consent. And every teenager knows that it’s not legal to drink until you’re 21. Most folks know that no matter how ambitious you are, you can’t be elected president until you’re 35.
But buying a house? There is no age restriction. Some might argue you can’t look for houses for sale until you’re 18, because a bank won’t let a minor sign a contract, but theoretically, if you had the cash and your parents were cool with it, you could be a toddler. Or you could be a senior citizen; this writer’s grandmother bought her first house at the age of 77 and is still enjoying it, almost eight years later.
It’s safe to say you’re going to be somewhere in between those ages — and you’re going to hear a little voice, just as Frey did, that says, “It’s time.”
That’s largely how Heather Clark, 27, general manager for Chicago Sailing, and her boyfriend, John Honkala, 32, a Web design business owner and part-time bartender, came to buy their house.
“We were planning on moving in together and expected to just rent an apartment,” says Clark, but she and her boyfriend changed their minds when they realized how inexpensive houses were becoming. But even without the lure of the financial incentives, it felt like it was the right time.
Clark says that they were both sick of moving, of dealing with landlords and of living in dated quarters. “My old apartment has been described as ’80s Florida chic,” quips Clark, referring, in part, to her “plastic vertical Venetian blinds.”
WHAT TO CONSIDER BEFORE BUYING YOUR FIRST HOME
THE QUESTIONS TO ASK YOURSELF
Regardless of how ideal the market may seem, it’s still a good idea to sit down with your real estate agent and think about how you see your life in three or five years and ask yourself some pointed questions, suggests Althea Smock, a real estate agent with ZAPA Realty in Denver.
Can I afford it?
Buying a house will have a significant impact on your finances, so make sure you can handle it.
Housing is more affordable than ever and incentives like low interest rates and the new expanded tax credit are enticing buyers to enter the market. But purchasing property involves a lot of upfront costs: closing costs, down payment, new furniture, moving expenses. Do you have enough cash?
Create a budget for the monthly mortgage payment and homeownership costs, such as general maintenance if you buy a single-family home or homeowners association fees if you buy a condo.