A Millennial’s Guide To Buying And Owning A Home
You guys, Joe and I have officially been home owners for a year now, but trust me- it wasn’t an easy ride getting to this point. So today my friend Mila’s sharing some really good info about buying and owning a home, stuff that will surely help you if you’re flirting with the idea of buying your first place. So here it is! Enjoy!
In my last post, I mentioned that my next life goal is to buy a house. That was no lie; I’ve got serious house fever, and I spend way too much time looking at houses online that I can’t afford. I dream about a three bedroom, two bath place with wood floors, a tricked out kitchen, and a huge back yard for all of the dogs I want. At this point in my life, though, I’m not financially ready, but that doesn’t mean I can’t start preparing myself for becoming a homeowner.
There’s a lot to know about buying and owning a home. There’s everything you have to do before you buy a home; financing, saving, searching and moving, and then there’s everything you need to know about owning a home, like maintenance and safety. It’s a huge thing to be a homeowner, so you really have to know your stuff.
Saving and Loans!
The biggest and most hindering part about buying a home is the money involved. I think it’s safe to say that most of us millennials aren’t rolling in dough, so if home buying’s on your mind, the first thing you need to think about is saving for your first down payment.
Look at your finances each month, and see how much you can put aside specifically for saving. Look into refinancing your student loans if you have them, and work on paying off any credit card debt. Don’t borrow from your 401k for your down payment. Instead, focus on making monthly budget cuts where you can. While borrowing from your 401k can sound appealing, the payback penalties are much more severe.
Once you feel like you’ve saved a sizeable amount for your down payment, you can start exploring mortgages and getting pre-approved. There’s a checklist of items you need to have handy when you’re applying for a mortgage, so besides having your social security card for identification, you need to have statements of your different assets. These include the last two statements of your bank accounts, retirement accounts, and any investment accounts you have, statements and monthly payments on any debts (such as credit cards and loans), your last W2s, and the past two years of tax returns. You should also have the make and model of the car you own, and a statement of its resale value. The combination of these things helps lenders calculate how much money you qualify for, aka, how much money they’re willing to lend you.
Finding a house!
Once you know how much of a mortgage you qualify for, you can officially start house shopping! This is the fun part, the part where you get to look at different places and see how they speak to you. Much like buying a wedding dress (I imagine, I’ve never bought one, haha), after looking at several you will find “the one.” You’ll know the feeling – you’ll step in and imagine spending holidays there, throwing parties, and holing up in it on introvert days. There’s one rule to house shopping though – don’t look at any house over your budget! There’s nothing worse than falling in love with something you can’t afford.
Also, when looking at houses, don’t be afraid to buy a fixer upper! While buying any house is an investment, buying one that needs some work is a great way to boost your investment even more. Not only do you get to fix and remodel it to make the place fit your style and taste, but if you ever need or want to move, you’ll often be able to sell the place at a higher amount than what you paid for it. There are people who literally make their entire living flipping houses like this, so it can definitely be a significant gain!
Maintenance and Safety!
The idea of owning a home is so great that we sometimes forget there’s work that has to e done to maintain it. I know I never thought about all the work my parents and landlords went through to keep their properties looking good. So as a new homeowner, it’s good to think about these things and to often be reminded of different ways to maintain a healthy home. Paint waterproofs your home, so make sure to check it for cracking and peeling. You should also pressure wash your exterior to remove mold every year, and recaulk your windows once every few years to protect the seals.
You also want to think about safety. When you have your own house, you want to make sure that you keep it safe from intruders, so locks are the first thing you need to make sure are reliable in your house. Another great way to startle and deter a burglar is to get motion lights, because the sudden light will alert them into thinking there might be someone up and awake. My favorite way to keep my home safe is my giant German Shepherd. He’s a complete goof and would probably greet anyone with open paws – but his bark is loud, and he looks intimidating so I feel much safer having him around the house. You don’t have to have a German Shepherd, though; any dog will send burglars running in the other direction. Their barks are like a fuzzy house alarm, and bigger dogs can offer an intimidation factor. Plus, when they’re not working on keeping your house safe, you get to cuddle and play with them. Win win.
So owning a house may seem like a lot of money and work, but it will definitely be worth it to have a place you can call your own. Renting a place is convenient, but ultimately you’re paying money towards someone else’s property, and you’re restricted to their rules. Owning a home offers you more freedom and an investment in your future, and some official “adult points” to add to your life. Happy house shopping!
Mila is a writer with a BA in English Linguistics living in beautiful Boise, ID. Her ambitions include traveling the world, studying languages, and taking pictures of her dog, Baymax. Connect with her on twitter and instagram!
Have YOU guys thought about buying a home anytime soon? What’s the hardest part about it all?
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