4 Mistakes You Might Make When Buying Your First Home

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  • You don't want to get in over your head financially when buying a home.
  • You also want to make sure you have the time for upkeep.

Buying a home for the first time is exciting. And if you've had a bad experience as a renter, you may be super eager to buy a place of your own. But as a first-time home buyer, there are certain pitfalls you'll want to avoid, like these.

1. Taking on too much house

In March, the median existing home (meaning, not new construction) sold for $375,700, according to the National Association of Realtors. You may be looking at a home that's more or less expensive than that, depending on the neighborhood you're hoping for. But either way, it's important to make sure your home is comfortably affordable for you from the start.

As a general rule, your recurring housing costs, including your monthly mortgage payments, property taxes, and homeowners insurance, should not exceed 30% of your take-home pay. Keep that number in mind when searching for a home so you stick to the right budget and avoid an instant financial crunch.

2. Taking on too many repairs

You'll often get away with spending less on a home when the property in question needs work. But be careful, because the "discount" you get buying a fixer-upper may not be worth it when you account for the cost of the repairs needed to get that home into better shape.

Financial concerns aside, buying a home that needs lots of repairs could make for a very disruptive existence. If you're purchasing a home whose kitchen needs to be gutted, for example, you might have to endure many weeks without a way to store or cook food.

3. Forgetting about rising costs

You may decide to purchase a home at the top end of your budget. Doing so might allow for a larger or more updated space. But don't forget that the housing costs you start out with aren't necessarily the cost you'll face a year or two down the line.

Property taxes have the potential to rise, and the cost of homeowners insurance can increase, too. Leave yourself with some financial wiggle room to avoid a crunch a year or two after you've moved in.

4. Not realizing what a time commitment home maintenance is

You may know to factor the cost of home maintenance into your budget when buying a home. But even if the money you're shelling out isn't a problem, you may run into an issue with finding the time for upkeep.

Of course, if you start struggling to find the time to maintain your home, you could always outsource more tasks. But that could end up straining your budget.

If you know upfront that you have a busy schedule and don't particularly enjoy home upkeep, you may want to opt for a property that's easier to maintain. That could mean choosing a home with a smaller lawn and less outdoor space, or even a smaller home to begin with.

Buying a home can be a rewarding experience, and there are many ongoing benefits you might get to enjoy as a property owner. But if you're buying a home for the first time, be careful when it comes to things like money and maintenance. You don't want to end up purchasing a home that makes you regret your decision to become a homeowner in the first place.

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