So you’re ready to buy your first home and are hungry to absorb some good information before you begin your hunt.
As you start searching the internet for tips on making this life-changing decision, you’ll learn the basics of what you need to do:
- Find a good real estate agent.
- Put in a large down payment.
- Do your research.
Today, I’m not here to give you any advice that you’ve likely already read about. Instead, I want to share 5 unconventional home buying tips you’ve probably never heard before.
(Thank you to the fantastic experts who shared this advice with me)
1. Buy a home like you would an investment property
"If there is any chance you won't be staying in the property for at last five years, pretend you are buying an investment property,” says Brandon Turner, co-host of the BiggerPockets Podcast. “In other words, if you buy a home and then move next year, chances are you will lose a lot of money due to the high costs involved in selling a home.”
Then when life event comes up (you have kids, you get a new job across town, etc.), you can turn the property into a rental. Brandon explains:
“If you pretend that you are buying an investment, something you can rent out, and you run the numbers to make sure it works as an investment property in a worst case scenario, you can always move out and hang onto the property, allowing your new tenants to pay down your mortgage while you move onto a new home!"
2. Use HUD to find deep discounts on homes
Here’s what Danny Johnson of Flipping Junkie had to say about HUD:
“HUD (the US Department of Housing and Urban Development), is charged with selling houses that are foreclosed upon when someone with an FHA insured loan defaults.
HUD wants to sell these houses quickly so that they aren't costing the government a lot of money. In order to do this, they price them very well. You can get a heck of a deal.”
Concerned that real estate investors are using HUD to move faster than you and get a bunch of deals?
Not to worry, says Danny.
“HUD wants to give dibs to homeowners and community workers like teachers. They devised an system where by most homes they offer for sale can only be sold for the first 10 days (usually) to people who are going to live in them.”
3. Use a discerning eye
"When you're considering any new home for yourself, take special care to have a discerning eye”, says Seth Williams, Founder of REtipster.
“Even if you love what you see at first glance, allow yourself the time to see the good, bad and ugly of the house in question. If you find that any aspects of the property seem annoying, irritating or inconvenient (like poor location, poor layout, or structural issues), realize that these problems will NOT go away with time.
If anything... these issues will continue to irritate and annoy as time goes on. There is no perfect property and every house has its problems, so with this in mind - make sure that whatever issues come with the house you decide to purchase, they are issues you are happy to tolerate."
You’re probably thinking to yourself, “I’m already considering spending a lot – it’s a home!” But as you begin to solidify your budget, it may not be a bad idea to look for homes at the high end of that spectrum.
Will Lipovsky of Blunt Money explains:
"Spend a lot. And I'm saying that as someone who's pretty frugal. Reason being, you spend so many hours in your home - it's important that it's a pleasant environment. Also, the value of the home will likely increase over the years. So while you probably won't get rich because you bought the property - it's unlikely you'll lose money on it.
You can't say the same about most sports cars, clothing, or anything else you could spend a lot on. So if you feel like treating yourself, buying an expensive home is a pretty great way to do it."
5. Choose a neighborhood you love, not just a home
As a Realtor, I’ve seen many first time homebuyers settle on a house they really like, but end up in a neighborhood that they regret choosing. Be cautious and look into the neighborhood before you make your final decision.
Here’s what Ryan Lundquist, Founder of the Sacramento Appraisal Blog, had to say about this tip:
“We all buy where we can afford, but it's still important to really consider the entire neighborhood instead of just the house. After all, buying a house is sort of like a marriage. You might get a spouse, but you also get the family. The same is true with buying a house because you get the neighborhood too.
Do your homework and be sure you are comfortable with what the neighborhood has to offer in terms of the school district, crime rates, parks, recreation, etc.”