Buying your first starter home can be an exciting time in your life. It will allow you to stop renting and start building equity. However, you do need to make sure that you are ready to undergo this endeavor as this is a life-changing commitment.
A starter home is a phrase people often put on a home that is a smaller, more affordable house that a person would buy for a first home. If this is the type of home you are hoping to buy, there are certain features in it that you should look for, and this is primarily because a starter home is not a home you will plan on living in forever. Instead, you will buy it with the intention of selling it at a later point in time, and here are the features you should aim to find in the home you choose as your starter home.
If you are ready to stop waiting, here are some signs that now is the time to buy your first home.
You Have Good Credit
In order to buy your own home, you will need decent credit. Your score should be at least 580 to qualify for an FHA loan and 620 to qualify for a conventional loan. Do keep in mind though that having a higher credit score can save you money because you can get a lower interest rate.
Your Job Is Stable
Most lenders will require that you are at the same job or work in the same industry for at least two years. If you’ve been working for this amount of time and have a stable job, it may be the right time to buy your first home. If you are between jobs or aren’t confident in your job security at your current position, it might be smart to hold off.
Real Estate Near You Is Affordable
A lot of people may feel that they are financially ready to buy a home but might not be able to because there aren’t any homes available that they can comfortably afford. If real estate near you is affordable, it may be time for you to buy a home. You don’t want to risk waiting too long and home prices going up so much that there’s nothing you can afford.
You’ve Saved Up Enough for a Down Payment and Closing Costs
The majority of buyers will need to have some sort of down payment. Depending on the loan, you may only need as little as three percent of the purchase price. However, it is a good idea to save up at least 20 percent to put down because then you won’t have to pay private mortgage insurance along with your mortgage payment.
You will also need to have enough money to pay for closing costs. While this number will vary, closing costs do tend to be about 4 percent of the purchase price of a home. Fortunately, there may be grants available that can help buyers cover some of these costs.
Before you decide to buy a home, you do need to make sure that you are ready. This is a large commitment, but it can prove to be a valuable investment for both you and your family. These are some of the things you should look for in your first home.
Potential to Sell in the Future
Buying a house that has potential to sell is one of the top things you should be concerned with when buying a starter home, as this is usually the plan for people who purchase homes that fall into this category. For a home to have a potential to sell, it should have the other features listed here.
Another thing to look for is a home with a great layout. You will want to avoid buying a house that has a weird layout or a design that does not quite make sense, so you should aim to find a home with a layout that works and flows well. Homes with awkward layouts or unusual features might not sell as quickly or for as much when it comes to move.
The House’s Location
A home that is located in a good community and in an area that people desire to live in makes the location of a home good, and a location of a home can either help you sell it or hinder your sale. Therefore, choosing a home based on its location is absolutely vital when buying a starter home.
A home that has been taken care of well is also a feature that will be vital in your search for the right starter home to buy. When a home is taken care of well, it will be in great shape. It will be more modernized than homes that were not cared for, and it is less likely to have problems. This includes both the interior and exterior of the property. Don’t forget about the wiring and plumbing either.
You may plan on living in this house for a few years or maybe longer, but at some point, you will want to be able to sell it quickly and for a profit. If you find a starter home with these features, you should be able to do this without any problems. To learn more, track down a real estate agent local to the area you are interested in to help you find starter homes for sale.