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Kernels of Wisdom For First-time Home Buyers

January 13, 2014

Have you ever made a huge decision such as moving to a completely different city or attending a particular college without doing research first and finding out if it was the right fit for you? Your answer is probably no because these types of things are complete lifestyle changes that require you to think before doing. Another lifestyle change that requires some education is purchasing your first home. This week’s show was focused on the importance of research, education, and timeliness for home buyers.

Ed Nelson from the Minnesota Home Ownership Center gave some great insight into the first-time home buyer experience. Ed discussed how many people feel some sort of urgency when purchasing their first home due to rates and prices. People think they have to buy “right now” in order to get the best deal. This is a huge mistake. Yes, the market changes constantly, but when you are looking to purchase something that is a life investment, there should never be a rush. Educate yourself with reliable sources whether it be a family member that recommends a certain real estate company or checking out websites loaded with information on home buying such as hocmn.org.

A great question that was asked by a listener is what are some key characteristics to look for in a realtor. Jennifer Dierkhising was also in studio from Wells Fargo Home Mortgage and gave a wonderful answer to this question. Jennifer advises her customers to interview at least 3 realtors before signing on with anyone. You want to compare personalities, see how they communicate, experience levels and are they listening to your situation. Making sure a realtor is the right fit for your needs is one of the first big steps in the home buying process.

Now let’s weigh in on the renting versus buying topic that has sparked most of these conversations. Renting may be good for those that are unsure of events happening in their near future such as getting married and moving in with your significant other or getting a job promotion that requires you to relocate. For those people that do not foresee any big change in their future, don’t let fear or financial issues scare you away from purchasing a new home. After all is said and done, more and more apartments are being built each year, but rent is also increasing about 5% along with these new developments.

Andy Prasky brought up the fact that although housing prices may increase in the current market, the owner of a house will lock in on a rate and it will never go up. Renters have the uncertainty of whether their rent will increase and then may not have the means for that change. With the locked in rates that are guaranteed for a home owner, you are not only prepared financially for your payments but are also putting money towards an investment that is beneficial to yourself, not your landlord. You may be exhausted after reading this article because there really is a lot of work that goes into purchasing a home, but when you work with the right people and the right companies, this process becomes much easier and is a great investment into your future.