Home buying season is ramping up which got us thinking; if we knew what we know now about home buying and homeownership, would we have approached it the same way?
What would we have done differently?
Would we have made the same decisions?
Instead of only giving you our advice, we asked 97 other homeowners a simple question:
What do you know now that you wish you knew before buying your first house?
The homeowners we asked this question to include our extended family, friends, and strangers that we engaged in real estate and homeownership forums online.
A handful of the folks we surveyed work in the real estate industry and were able to provide excellent advice from their perspective.
This article skips the common-sense advice and takes things a step further providing knowledge that you could only have if you’ve personally gone through the home buying experience.
Use the links below to navigate this article:
- Get to know the neighborhood before you buy
- Create a list of needs and wants, don’t sacrifice your needs
- Map out the commute for current and future jobs
- Do your research on the school system
- Find the best inspector and make sure you understand everything he or she reports
- Find out the age and condition of the major appliances and systems
- Make sure all of the big-ticket items are in good shape
- Shop around for the best mortgage rate with a lender you can trust
- Maintaining a large yard is costly and time-consuming
- Other outdoor considerations for homeowners
- Home orientation matters
- Consider the time and cost of snow removal
- Be prepared for unexpected repairs
- Understand how the size of the house impacts costs
- Make sure the house is functional for now and in the future
- Make sure you understand your liabilities and protect yourself and your assets
- Learn the positive and negative tax implications
- Plan to stay in your home for 5 years or more
- Forecast the total cost of your loan and taxes
- If the house has renovations, check the permits
- If you are thinking about a fixer-upper, know what you’re getting into
- Check the wifi and cellular connection
Things To Know When Buying a House
Without further delay, here are the top things to know when buying a house according to 97 experienced homeowners.
We put this one first because we believe it is the most important. You can change almost everything about your house if you really want to, but one thing you can’t change is your neighborhood. Your neighborhood and the people that live around you will have an impact on your life in more ways than you know.
If you are looking for a quiet neighborhood in the suburbs or if you prefer to be in an urban setting, make sure that is what you are getting. This seems like common sense but so many homeowners justify neighborhoods that don’t fit their desires and end up regretting it.
If you desire to be close to certain shops, gyms, restaurants, or public transportation, map all of that out so you know the exact distances from your neighborhood to those places.
Spend time in the neighborhood. Don’t just go to an open house and one private showing and make an offer. Visit the neighborhood at different times of day and days of the week.
Are families outside? Are people walking dogs? Are people running and biking? Do people keep their garage doors open? Generally, these things are indicators of a safe neighborhood.
Take note of noise levels during your visits. Noise can come from many places including barking dogs, traffic, train tracks, airplanes, music venues, schools, and church bells. Some of these are obvious but others require you to get to know the neighborhood.
Be observant of any smells, pollution, and litter.
Go to other open houses in the neighborhood to see who your future neighbors could be.
Knock on the neighbors’ doors and introduce yourself. This is especially important in neighborhoods where the homes are close together. Ask them how long they have lived there, what they like most and least about it. Most people don’t think this is intrusive. If they do, it might be a bad sign. Not all neighbors want to be best friends but most will appreciate the gesture of reaching out to learn more about the neighborhood.
Make a list of non-negotiable needs and nice-to-have wants. My non-negotiables were a big kitchen, outdoor space like a patio or deck, living room that works well for entertaining, and a location that is under an hour commute. My wants were a large dining room, a master bath, and a family room for kids to play.
Think about not only what matters to you now but also what will matter to you in the future.
Don’t sacrifice your needs.
This goes right along with getting to know the neighborhood. Make sure you always check the commute time via Google maps. Check it for times that you will actually be commuting. In some cases, a mile in one direction can add 30 minutes to a commute because of traffic flows.
Most open houses and private showings are on the weekends or at night when traffic is very light. Make sure you know the real commute time before it is too late. Even 10 or 15 minutes can feel significant at the end of a long day/week.
On a weekday, do a mock commute. Sometimes even Google Maps isn’t totally accurate. At my last company, I didn’t factor in additional drivers on the roads in the summertime commuting to Cape Cod or an influx of traffic when the Red Sox were in town. Think through what could impact the commute throughout the year.
Consider commute times for future jobs too. Most people spend five years or less in a job so make sure you are moving to a location that is close enough to other jobs. Unexpected layoffs could happen anywhere so make sure you have a backup plan that doesn’t require an unbearable commute.
The obvious benefit of great schools is that your children will get a great education. The secondary benefit is that a great school system will increase property values which benefits all residents whether they have kids in the system or not.
Check the public rankings, test scores, classroom sizes, and before and after-school programs. Attend a school committee meeting. Reach out to the superintendent and ask about their plans to improve the school system.
This came up at least a dozen times in the responses. Make sure you hire a great inspector.
Find an inspector on your own or one that is recommended by someone you trust. Do not take a recommendation from someone invested in the sale of the property, like your realtor or, even worse, the seller (this is rare but does happen).
Do your research on the inspector and make sure they have many years of experience and excellent reviews. Just because your dad or uncle is a contractor doesn’t mean they are qualified to judge a house’s condition. Home inspectors have specialized training and uncover issues that even the best contractors won’t see. Most states require home inspectors to perform regular field training and pass a test to maintain their license. To find out the home inspection certification requirements in your state go to this site.
Some homeowners not only recommend getting a great inspector but to also have each system checked by a specialized tradesman. Hiring a plumber to check the plumbing or an electrician to check the wiring will not be cheap but could save you thousands in the long run.
On the day of your inspection, don’t stand off to the side. Walk with your inspector through the property and ask questions along the way. Most good inspectors will welcome this. There will be dozens of things they point out and your best opportunity to ask questions will be on the spot. You’ll learn a lot about your future house through this process.
Don’t go for the cheapest inspector. Most inspections cost about $400 in most areas. It is money well spent.
Under no circumstances should you waive your inspection contingency. In the seller’s market that we are in, many buyers forgo an inspection contingency in order to make their offer more attractive. It’s reckless, irresponsible, and puts you at an extremely high risk for financial disaster in the future.
Appliances and systems like HVAC, water heater, furnace, washer/dryer, dishwasher, and kitchen range are not cheap. When they get older and breakdown it will be costly to service and even more to replace them.
During your visits to the home, make note of each appliance and the year they were manufactured. You’ll be able to look them up online and determine how long they last. This will give you an indication of when you will need to replace them and how much it will cost.
If you are buying a house that has older appliances make sure you factor that into your negotiations. Appliances are critical to operating your house and can’t be neglected.
There are a handful of items that will cost thousands when it comes time to replace. Make sure you know the condition of those items before buying the house.
We already talked about appliances, the others are the house’s foundation, plumbing, electricity, windows, roof, and kitchen.
Foundation – If the foundation is in need of repairs, any good inspector will report that and give you an idea of the severity. They will inspect the basement and crawlspace. They will look for cracks in walls and off-kilter doorways. Don’t try to assess this yourself, trust the inspector and get a second opinion if you have to. If the foundation needs repairs it will be very expensive so know what you’re getting into before you buy.
Plumbing – There are many reasons why your plumbing might need repairs or to be replaced. Plumbing has evolved over the years and older homes usually have pipes made with materials susceptible to erosion. Over time, tree roots can clog pipes and cause sewage to flow into your home. Drains, vents, and valves can lose effectiveness over years causing major issues. It’s not always easy to see these issues without breaking down the walls but you should know when the plumbing was replaced (if ever) and understand what that means for future expenses.
Electricity – Similar to plumbing, electricity has come a long way and the practices they used 50 or 80 years ago when your house may have been built are very different than what they are today. Wiring and electrical needs to be done right and be up to current code. A seemingly minor issue can lead to a disaster like an electrical fire. Make sure you are fully aware of the age and condition of this major system so you can anticipate immediate or future costs. Do not do-it-yourself when it comes to electricity.
Windows – This is important for a couple reasons. First, windows are expensive so if you’re looking for a home with older windows, count them and research the cost per window. Secondly, you’ll pay a huge price for heat and air conditioning if you have old drafty windows.
Roof – Your roof is what protects you from all of the unpredictable elements that mother nature throws at you. This protection is also one of the most expensive things you’ll need to repair or replace. Find out what type of roof you will have and the date it was replaced. A roof with 3-tab asphalt shingles will last between 15 to 18 years. A roof with architectural asphalt shingles will last between 24 to 30 years. A roof with galvalume, which is a type of metal, can last up to 45 years.
Kitchen – The kitchen is the most expensive room in the house to remodel. If you’re looking at a house with that idea in mind, make sure you research the full costs of that renovation. If you have a contractor or someone in your family that knows construction, bring them to the showings to get their opinion on the cost and feasibility. Don’t assume you can knock down any wall you want like they do on HGTV. The good news is that kitchens are a large driver of home value and a fresh design can add a lot to your home.
Just because you got pre-approved with one lender doesn’t mean you have to get your mortgage through them. Get quotes from at least three lenders.
Mortgages are a commodity. The two things you need to consider are the interest rate and the service.
The interest rate is simple. Get the lowest rate you possibly can. Most lenders will be within a few basis points of each other but those differences can mean thousands over the life of the loan.
Service matters mostly during the initial set-up. Your lender should be organized, responsive, and readily available to answer your questions and addresses your concerns. Your contract with the seller will have a deadline for proof of mortgage approval. If your lender isn’t organized, responsive, and moving the process along on time, you risk missing deadlines and losing out on the house. We didn’t run into any issues with the lenders we talked to. Almost all lenders work on a commission structure so they are highly incentivized to give you exceptional service and make sure the transaction goes smoothly.
Prioritize the interest rate but make sure you are comfortable with the service you are getting.
Big yards are great for the dog and for the kids to play. Space for a future pool, deck or patio is great to have. But there are downsides.
Keeping your lawn in good shape will take a lot of time or money and in some cases both. If you buy a house with beautiful landscaping, don’t expect it to stay that way unless you are prepared to invest significant time and money into it.
Depending on the size of your yard, mowing, weeding, and gardening can take hours each week. Make sure you budget for the tools and machinery you’ll need and the storage space to put it all. Hiring a landscaper is convenient but costly. Lawn treatments for weed control and reseeding is another expense. Even with professional lawn treatments, it will still be a constant battle against the weeds and, for me at least, usually a losing battle.
One of the highest cost of yard maintenance is water. Giving your lawn the recommended waterings could cost you hundreds during the summer months. As much as you spend, expect some yellow, dried up grass during weeks of intense heat.
As much as you’ll enjoy the space, learn what it takes to maintain a large yard and figure out if you can handle the responsibility.
If the yard slopes down into the house, that is a bad sign. When it rains, expect water to flow directly toward your house. Even if you don’t have flooding issues now, over time that water flow could damage the foundation and create major issues. Visit the house during a raining day to see how water flows and where it pools.
If there are trees close to or overhanging the house, you’ll need a tree service company to come out and remove or trim the overhanging branches. The roots of large trees can also cause problems with underground pipes going in and out of your house.
Home orientation (the direction your home faces) can be a big factor in energy costs and overall enjoyment of your home.
If you ask five different real estate professionals what the ideal home orientation is, you might get five different answers. The real answer is, it depends. It depends on the shape of your home, what rooms you spend the most time in, where those rooms are located, where your driveway is, what part of the yard you spend time in, and where the most windows in your house are.
The key thing to keep in mind is that the sun rises in the east and sets in the west so think about what that means in terms of which rooms will benefit the most from natural light and passive solar energy. Also, think about the outside of your home.
To make things real I’ll give you an example. I don’t have a garage and my driveway is on the west side of my house. Because of this, the sun doesn’t touch my car until well after I’m gone for work. So, as you can imagine, every day in the winter my car is completely frozen while my neighbors’ cars across the street are thawed out. I’m not saying this would have been a deal breaker, but if all things were equal, I’d prefer to have my driveway on the sunny side in the morning.
Think about your yard too. Would you want a backyard with a pool if you barely got any sunlight during the day? Probably not.
This goes back to the recommendation to visit the home at different hours of the day. You can try to become a scientist overnight and figure out exactly where the sun will and will not be throughout the day, but the best way is to experience it and see it for yourself.
More great info on this topic from SFgate.com here.
If you are looking to buy in an area that has snowy winters, be prepared to spend significant time and/or money on snow removal. A big, long driveway seems like a great idea until you have to shovel it yourself or pay a plow every time it snows.
I grew up in a house with a long driveway and it cost $70 every time the plow came, which was very often. I distinctly remember my dad would shake his head and say “cha-ching” every time the plow came.
Some cities and towns require you to clear the sidewalks around your house so keep that in mind too.
The little things add up. Make room in your budget for unexpected expenses. The garage door opener breaks, the deck needs to be re-sealed, the toilet is leaking, the fridge is suddenly making a weird noise; these types of things happen all the time. Unfortunately, there is no landlord to call, the repairs are coming out of your wallet so be prepared.
In addition to repairs, there are so many things you will need to buy to get started in a new house. Check out our article that covers this topic in detail.
I totally understand the allure of a big, huge house. More bedrooms and bathrooms for more privacy, more rooms to relax and entertain, space to spread out and enjoy life.
Square footage also comes with downsides. Not only will the price tag on the house be higher, the taxes, cost to furnish, heat, cool, and maintenance will be too.
Smaller homes are not only less costly but they force you to stay organized and not become a hoarder.
The size of the house you choose will totally depend on your needs. So buy a house you can afford that gives you the space you need but keep in mind the implications that choice will have on total costs.
One of the more interesting pieces of advice we got was to go into the master bathroom and pretend you are getting ready for work with your significant other. See if that space and the layout is big enough and works for you.
Think about your plan for your family. Will one and a half baths really be enough if you have another child or when your little ones grow up?
Think about the activities you will be doing daily and make sure the house works especially well for those.
Get a homeowners insurance policy from a highly rated carrier. Your home will be the largest purchase you ever make and your greatest material asset, do not go for the cheapest insurance policy you can find. Make sure you get full coverage and understand what each section of your policy means.
Consider an Umbrella policy on top of your homeowner’s policy to give you further liability protection. This can be a financial lifesaver if someone gets seriously injured on your property and sues you.
Bundle your auto and home policy with the same carrier, it will save you money and hassle.
Get a free insurance quote before you even put an offer in. It will help you determine true monthly fixed costs and give you an idea of the risks associated with your house. If you are in a flood zone your mortgage company will require you to carry flood insurance which can be hundreds of dollars per month and impact whether you can afford the house or not.
Talk to your accountant and understand what homeownership means for you from a tax perspective. You’ll have to pay property taxes which will likely increase as your home appreciates. You’ll get to write off your mortgage interest.
The benefits and drawbacks vary by each individual situation so my best advice is to talk to your accountant to learn the tax implications of homeownership specific to you.
Homes can be a great investment but not if you jump from house to house every couple of years. Think about all the costs associated with the transaction of buying a house: closing costs, attorney’s fees, moving costs, realtor commissions, repairs, appraisals, inspections etc.
No one can predict the market so unless you are an experienced house flipper, plan to stay at least five years to get the best value from your home. Real estate is not a sure thing. Buy knowing that the value may never go up and has the possibility of going down (2008).
Use an amortization calculator, like this one, to get an idea of what the loan will truly cost over its lifetime. In the beginning, you are mostly paying interest.
If you put a down payment of less than 20% of the purchase price, you are required to pay private mortgage insurance (PMI). PMI is insurance that protects the lender if you stop paying your mortgage. Essentially, if you don’t put down 20%, the lender sees that as a higher risk that you won’t make your payments, therefore, requires you to pay for insurance to protect them.
The cost depends on the risk to the bank but can be hundreds of dollars in some cases. If you can’t afford to put down 20%, look for a less expensive house or ask about lender-paid mortgage insurance. Like the name suggests, lender-paid mortgage insurance is paid by the lender but you will likely get a higher interest rate, so you have to do the math and figure out which option makes the most sense.
Property tax rates are based on the value of your home. Hopefully, your home will appreciate overtime but when that happens, you’ll owe Uncle Sam more money each year in property taxes. Each state assesses the value of homes on different schedules. Keep in mind that your taxes will likely increase over time.
Permits are public record and you can usually find them on the town website in the building inspection section. You can also go to your town hall and ask them for the address of your potential home.
One of the major regrets we heard from respondents was that they wished they did more research and asked more questions about the work that was done on the house over the years. Permits can help answer some of those questions but nowadays so many people do it themselves or hire a friend or family member and don’t pull permits for the work (even though they are legally supposed to). This can cause major headaches down the road if something wasn’t done correctly to code.
Do your research, ask the seller, and dig into things that look renovated with your inspector.
HGTV is creating a frenzy with all of their house flipping and renovation shows. That, along with the fact that real estate prices are so high, is driving more and more buyers towards older homes that need a lot of repairs and renovations.
Those shows make renovations look way easier than they really are. Major renovations don’t take weeks, they can take several months and, in some cases, over a year. Projects often go way over budget and off schedule.
If you decide to go this route, be mentally and financially prepared to deal with unexpected costs and longer than agreed upon timelines.
Don’t expect to get every dollar that you spent on the renovation back in home value. Your home is only worth what someone else is willing to pay at a given time. Most of the time, people look at the price per square foot of recent comparable sales in your neighborhood and won’t pay a huge premium for your expensive backsplashes and countertops.
If you decide to do major renovations, do them before you move in and avoid the stress of living in a loud, dusty and dangerous construction zone.
If you live in or near a major city this one sounds silly but for those of you in more rural areas, make sure the property gets cell and internet service. When you are visiting the house, check your phone and try to make a call.
Check with the local internet providers and make sure they will service your address.
Ready to become a homeowner?
This advice makes homeownership sounds pretty miserable, huh? That is certainly not our intention. Our goal is to give you prudent information that will help you make the best choice during this pivotal moment in your life.
Although this advice may seem negative, it is important to know the truth and learn from the mistakes of others. We believe homeownership is a wonderful thing and now you have the knowledge to have the best experience possible.
We’d like to give a big thanks to the 97 friends, family, and homeowners that sent us their advice. With our limited experience as homeowners, we simply could not have put this together without you. Thank you.
Are you a homeowner? What did we miss in this article? Are there other important things to know when buying a house? Let us know by contacting us directly or commenting below. We will update this article as we get more helpful advice on homeownership.
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