The Wright Sisters Group | Union Realty Brokerage Inc. - The Beaches, Leslieville, Riverdale and East York Real Estate Specialists – Your East End Toronto Real Estate Team
09 July 2020
Melanie Wright

5 Home-Buying Tips Every First-Timer Should Know

Even during challenging times, there are people who need to think about purchasing a home. That includes buyers who have never done it before. The truth is, the process looks different during a pandemic (it has to, in order to keep participants safe), but the fundamentals are the same. Whether you need to buy sooner rather than later or you're doing the research now for a purchase down the line, there are a few things you should know if you're a first-timer.

Here are five tips you should use when it's time to buy your very first home...

1) Get pre-approved

Many first-time buyers forgo it, but obtaining mortgage pre-approval is crucial. This early step consists of having a lender look at your financial situation (including your income, debts, and credit score) to determine how much financing you're likely to receive. You can use this information as a jumping-off point when you set your home-hunting budget. Even more importantly, pre-approval shows sellers that you're ready, willing, and financially capable of closing.

2) Know your costs

When you're figuring out how much home you can afford, make sure you think beyond list prices. Failing to budget for your down payment and future homeownership expenses is a rookie mistake—one that could lead to a lot of wasted time and effort. To avoid looking at properties outside your price range, be sure to budget carefully. Know how much you can afford to pay for a down payment upfront, and don't forget to factor in ongoing utilities and maintenance.

3) Understand your needs

It's a common first-time buyer mistake. Searchers who are new to the process get their hearts set on a particular community or home type. The reality is, sometimes a similar neighbourhood nearby or a slightly different layout would serve them better than they think. That's why it pays to carefully consider (and create a list of) your home-buying must-haves. You should also prepare to be (at least a little bit) flexible, and work with a real estate agent who has in-depth community expertise.

4) Perform your due diligence

We've all heard horror stories about buyers who purchase a home, only to discover major defects later on. The good news is, there are steps that every first-time buyer can take to protect themselves from this outcome. From having a thorough inspection to adding the right conditions to your offer (which can protect you from worst-case scenarios), your agent can advise you on how best to reduce any home-buying risks.

5) Be prepared for closing costs

Closing costs can sneak up on buyers who aren't prepared. From legal fees to title insurance to land transfer taxes, these are the expenses you'll have to cover before you close. Typically, you can expect to pay somewhere between 2 and 4 per cent of your purchase price, so you'll want to make sure you budget appropriately. If you have any questions about closing costs and what they include, ask your real estate agent for more details.

Have questions about buying your first home? Reach out to get the answers you're looking for today.