While it may seem simple, knowing what to look for in a starter home is critical to financial and emotional success. Making the wrong choice can lead to stress and end up costing you more money in the long run. Here are five key factors you should consider when you are looking to buy a starter home. Also, these are not ranked in importance; just consider all of these factors when making your decision.
- Neighborhood
- Affordability (are saving for a better or home or planning to sell for a better home)
- Is it close to the things you want?
- What shape is the house in?
- How will this starter home help you in the future?
Neighborhood
One of the most important things to look for in a starter home is the neighborhood in which the house is located. Neighborhoods can have large effects on property value and can add more or less stress to your life. Neighborhoods not only affect you and your spouse but also your kids as well. While it may seem like a small choice, certain communities also have certain amenities with them. This can include walking routes, play areas, pools, and other community-building factors. if you can see both you and your family thriving in this area then you’ll know that you found a starter home that’ll work for you.
In addition, HOA’s Can make or break a community. There are some awesome stories about HOA’s and some horror stories as well. They can require certain standards to be met like lawns being mowed and music being played within your community. HOA’s can also set up community patrols and events to bring a neighborhood together. If you don’t want to deal with answering to someone, then you should consider a neighborhood that does not have an HOA.
Affordability
At the end of the day, the price is usually the deciding factor in choosing a starter home. Starter homes, by nature, are not homes that you plan to stay in for the rest of your life. They serve as a starting point for you to build a family or to make an investment. Although you may be qualified for a $200,000 home, that probably isn’t the best deal for you if you’re at the very top of or above your budget.
Instead, look for a starter home that is well within your budget and gives you extra breathing room should a financial crisis happen. Doing this will allow you to save for other expenses and spend money on things like vacations, hobbies, family get-togethers, and random life adventures. Don’t let yourself get into a bind. When you find the right price for a home then you’ll know it’s time to buy a house.
Keep in mind that 2% to 5% of the home that you buy will need to be paid in closing costs. If you don’t have that cash on hand, it means you need to borrow more. Also, think of ways you can increase home value as you live in the property. That way, you get the max return on this investment when you sell the home.
Is it close to the things you want?
Location is definitely something that takes precedent in what to look for in a starter home. Being close to the things that you want like a school, job, or family can really make a starter home worth the investment. Being an hour away from your job makes for a frustrating commute and soaring gas expenses. Most people take the 10-minute commute over granite countertops any day of the week. Take stock of your key priorities in what to look for in a starter home:
1. How will this property make my life easier?
2. How can this property give me more time to do the things I want?
3. Is this starter home in an area where I can switch jobs?
What shape is the house in?
Always look out for repairs in a starter home. Just because the price tag is good doesn’t mean that starter home is for you. Doing massive renovations or repairs takes a lot of time and patience. Not to mention a lot of physical work unless you have money to spend. This in turn can make you hate the starter home you just bought. If you have little to no experience with home renovations stay away from homes that need a major repair.
Also, hire someone to do a home inspection. A home inspection can reveal minor and major repairs in a starter home. Before buying a home, make sure to have a home inspector come out and check the foundations, plumbing, electrical wiring, interior walls, and exterior walls. After the inspection, you’ll be able to make the right decision on whether or not to purchase that starter home.
How will this starter home help you in the future?
Think about how you want your life to look in 5-10 years. Maybe you are thinking about having children, or switching jobs, or maybe even want to go back to school. Knowing what to look for in a starter home is already tough, but trying to plan for the future can be challenging. Pick a home you can grow into. This doesn’t mean that you should go over budget, but try to find a starter home that allows you a little bit of extra wiggle room. Consider things like:
· Access to nearby hospitals?
· Access to childcare and school services?
· How far away are you from your church?
· Are you in a neighborhood that will increase your property value?
· Clear Access to public colleges?
· Access to parks and hobbies?
Knowing the answers to these questions can help you know what to look for in a starter home. Base your decision on the practicality of the home. A home in the country may seem like a good idea when you’re by yourself, but there won’t be many opportunities for your children. Knowing your goals for the next 5-10 years can really help you choose the right home.
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