For many realtors, property ownership is only part of the business in real estate. However, it is fairly different than any other investment. It is important to understand the industry and what you need to do as a first-time buyer.
Here, we will discuss our top 4 tips on how to successfully purchase your new home.
Pay Off All Debts
Are you in any sort of debt at the moment? Do you still have to pay off your car and student loans? Are you preparing on how much you need to spend when you send your child to college? Consider not just your current situation but also your future plans in your finances.
Prepare Your Down Payment
Properties require a large down payment and approval requirements that buildings. Instead of the average 3%, you will need to provide at least a 20% down payment to secure the purchase of the property.
Furthermore, the main objective of purchasing a new home is to keep all expectations realistic and within your budget. Just as with any investment, buying your first home for rent will not gain you a high monthly income. Consider working with someone with experience to help you gain hands-on experience.
Don’t Opt for A Flip House
While you might be tempted to buy a cheaper house that you can flip, this will only create more hardships if you have little experience. Unless you are a contractor or are partnered with one, you will need to splurge on home improvement and everything that goes into a home remodel. Opt for a house that is within your budget but requires little to no repairs.
Calculate the Costs of Operation
The overall cost will range from 30 – 80% of your gross income on the home. If you decide to charge around $1500 per month, you will be left at 40% as your expenses will cover $600. Just be sure to consider what you expect to pay for the total expenses of operation.
Got any tips that you would like to share with us? Comment below and let us know!