First Time Homebuyer Series - Part 4: House Hunting - What to Expect

It's time to grab a coffee, load up into the Toyota Highlander (that's what I drive), and hit the streets! The day has finally come when you get to live out HGTV's show House Hunters.

In Part 4 of our First Time Home Buyer Series, we will talk about what to expect when you start seeing houses in person, and a few tips to make your time more productive.

What to Expect

1. Compromise

Compromise! That's not a fun way to start! I know you want your first home to be your dream home - the best location, the best street, flat back yard, huge kitchen, spa-like master bath, and every paint color exactly what you would have selected. Sorry. Unless your first home is a multi-million dollar custom home, it's not going to be like that. You will see features that you like and dislike in each home. One of the fun things of going to see houses is that you may not even know that you like some features or dislike others until you start to see them. Making notes on these features helps us find other homes that will be good fits.

2. Location, Location, Location

There is a reason that this is the most recognizable saying in real estate. You have to pay for prime location. I am a big fan of buying in the best neighborhood that you can afford. However, what you can afford in different neighborhoods will vary widely. If you've seen an amazing house in a less expensive neighborhood, be prepared that the equivalent house in a more expensive neighborhood will be much pricier.

3. Staging Helps Sell

I guess we are going through HGTV's lineup today, and next up is Design to Sell. There is a big difference going in a cold and empty house versus one that looks like it came out of a Pottery Barn catalog. Don't be fooled by the furniture! I see lots of buyers focus on the seller's possessions - furniture, decorations, pictures, and personal items. That doesn't come with the house! If you are having a hard time envisioning an empty room, talk through it. Your agent has seen 1000's of houses and can help you decide if there truly is an issue with space.

Tips

1. Prioritize

In Part 3 of our Series, you made a list of what you wanted in a home. As you start looking at houses in person, you may find that no house has everything on your list. Now is the time to start prioritizing. What are the most important items on your list? Is it location? If so, you may have to give up some size and finishes. Is it space? If so, you may need to focus in a less expensive neighborhood. Until you decide what is most important to you, it is really difficult to compare your options. For example, is a small bungalow in a great neighborhood close to your office more attractive than a huge home with a basement that is 30 minutes away? It all depends what is on the top of your list. If you don't know the answer, your agent won't either!

2. Some Changes are Easier than Others

Everyone wants to put their own individual stamp on their first home. That can be anything from painting a few rooms, to renovating a kitchen, to finishing a basement. You have to keep in mind that some changes are much easier to accomplish than others. I see a lot of first time buyers focus on having to make those easy changes when the other factors are really more important.

Let's go through the things that are hard to change - location, square footage, layout, the lot, your neighbors. Your house isn't going to move. That means that your location, neighbors, and lot are not changing. You better like them! It is possible to add on to your house or change the layout, but it is much easier to finish a basement versus adding an addition or to update a kitchen versus knocking out walls and changing the kitchen layout.

You also have some things that are relatively easy to change - paint color, flooring, fixtures, appliances, and landscaping. It is easy to focus on the style, finishes, and decorations in a home. However, these are really the easiest changes. Anything that can be done in one day by one vendor (appliances, new carpet, countertops, new light fixtures) is pretty straight forward. For example, does the kitchen have plenty of space and a great layout but is stuck in 1989? If so, replacing the appliances and countertops are some of the easiest and quickest improvements. On the flip side, if it has top of the line appliances, but is small and non-functional, expanding the kitchen is usually a much harder fix.

3. Good Deals Go Fast

Everyone wants to get a deal. For some buyers, that is on the top of their wish list. It is a buyer's market, but when the price is right, there are buyers who will snatch it up. In 2010, houses that sold without a price drop (meaning they sold without the seller dropping the original list price), sold on average in less than 30 days. In 2010 alone, my clients were in dozens of multiple offer situations, which means that more than one buyer is bidding on a house at the same time. If it is truly a good deal, you have to act quickly. This is one of the biggest things with which your agent can help. He or she should be an expert who knows when a house is priced right. It may take you some time in the market to feel comfortable making a quick decision, but if you are still getting comfortable, be aware that one or two houses could get snatched up while you are making up your mind.

In the next part, we will talk about what happens once we've found the right house and are ready to buy it!

Justin Landis
Keller Williams Realty
404-803-0471
justin.landis@kw.com