Buying a House for the First Time: Tips that Help

Whether you are single or with a family, one of the biggest purchases and delicate decisions you will ever make is buying a house for the first time. It seems very exciting when you’re browsing real estate websites and looking at virtual tours, but the process can be quite confusing for others. If you are serious about purchasing a home, you would want to look for ways to make your choice as wise as possible.

Buying a house for the first time: My personal experience

We purchased a home overseas as a part of our financial independence investment. Although it was nice to browse around and feel excited about things, owning a home often feels like opening a can of worms. First off, you have to figure out your loan payments or understand how much downpayment you may need to get approved.

Since we also owned a brand new house and lot, there were also construction woes. I expected to have bumps along the road, but the number of hurdles we experienced is something I didn’t really fathom along the way. Thankfully, we all surpassed them and were able to rent out the property to our first tenant. God is really good!

So, as a property owner, I would like to share some tips for first-time homeowners looking to purchase.

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Buying a home for the first time? Strategies that worked for us

Consider the present and future value of the property

Not all homes that fit your budget will be a good deal. Even if you’re a motivated ‘fixer-upper’ who’s willing to put in the work to make the home beautiful, there are still a lot of things to consider when choosing a property to own.

One of the things we looked into before purchasing a house overseas is to think about the present and future value of the property. We considered things like:

• The neighborhood where the house is in
• The vicinity and community (is it a growing city or is it near growing cities?)
• The reputation of the developer
• The satisfaction of current homeowners
• The rate at which the homes are selling in the area

The considerations above are indicators of the value of your property. Make sure to ask questions, visit the area, and have a deeper understanding of what it’s like to be in the community where the home is–whether it’s an investment property or your forever home.

Calculate your loan-related expenses

The very first thing to consider in the area of finances when buying a house is figuring out your loan. When the typical loan has a certain percentage of downpayment before they will approve and give out your amortization. Thankfully, in the some property developers in the Philippines, even downpayments can be staggered without interest rates so we were able to go in that direction.

However, not everyone will agree with this plan–you have to calculate your downpayment and monthly amortization to see if this is a viable option for you.

I used a loan calculator that puts in the interest rate included in the payments. This calculator applies the estimated expenses, so it really helps me see long-term to plan our budget for this investment.

As you can see, you can put in the total price of the home along with the designated interest rate. It will calculate for you how much you may need to pay monthly putting into consideration the type of loan and interest rate you have.

Although in this chart you would see that the currency is in UK pounds, just put in the amount you would in your home currency and it will still calculate your payments in the same way.

Think about your closing costs

The payments aren’t just in the area of loans and amortization. You will also have some expenses during the closing costs as you buy the house. These closing costs also have their taxes, which can range around $2,000 to $8,000. So make sure that during the process, you have this leg room of closing costs allowance as you complete the deal.

Have a team to help you out

If you’re a busy person with a lot of things in your plate, it can be really beneficial to have a team with you to help you make the best purchase. This can include a trusted realtor, a property inspector, and a bank or loaning company to help you in the whole process. If you are purchasing property overseas, having a trusted person in that area can greatly help with all the dealings, visitations, and can smoothen out the process.

Let your desires be known to your team, especially when it comes to budget range, type of home, interiors, and exteriors. Creating a checklist for your realtor can help you narrow down the best choices, and the property inspector will help in assuring that there are no major problems should you purchase a pre-owned home.

Working with a bank or a loaning company that has the best interest rate can also help in this process as you lay a foundation of future payments.

I hope these tips helped you out in buying a house for the first time! I wish you the best in your journey as a property owner.

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