In the future you want to buy a house of your own, a nice place that is all yours (and maybe your partner). However, saving for your first house might still seem a bit unrealistic and far away. Because how much do you need to save? And how do you put it all together?
In this article, we’ll share some practical savings tips for first-time homebuyers.
1) Identify the Amount of Savings Needed To Build a Home
You have your savings goal in mind: a nice place of your own. But do you know how much you need to save for it? In addition to the new bank you want to buy from, you should also consider the additional costs of purchasing a home, such as a mortgage counseling and building inspection and appraisal fees.
You should also save up so you can outbid (offer more than the asking price). We are currently dealing with an overheated real estate market. Houses are selling like hotcakes these days, but because there is so much demand and so little supply, you need to save a lot to compete now.
If you set an amount in your mind, you can do your best to do something about it, and it will be easier to continue saving for a home.
2) Start Saving for a Home as Soon as Possible
Even if your income is still low, it is wise to start saving. This is because that way, you will learn to save and make it a habit. Saving is a fixed cost, just like groceries or rent.
When your salary goes up, simply increase your monthly savings, and you will soon be able to save an amount of money. Also, consultants and credit agencies will be happy that you are saving regularly and that it has become a habit.
3) Set Realistic Deadlines
By when do you want to be able to buy a house? Finding a realistic deadline may be more complicated than you first thought. Setting a deadline too early can lead to frustration and disappointment. But if you delay too long, you may find that other things take precedences, such as new pants or a trip.
Once you know exactly how much is coming in and how much is going out, you will also learn how much you can realistically save each month. Since you have already calculated how much you need to save in total in the previous clue, the question is to calculate how many months you have saved that total amount.
4) Staying Motivated
The temptation to lose focus and motivation is sometimes strong, especially if you plan to buy a house in a few years. For example, if the time frame does not seem fast enough. Therefore, look for ways to empower yourself and stay motivated.
For example, if you have a savings buddy, you can encourage each other. Have an Excel sheet where you can see exactly how much you still need to save to build your first house. Or, if you’re more of a visual thinker, color in a savings tracker.
5) Choose Your Real Estate Agent Carefully
A good real estate agent will find homes that match your requirements and guide you through the negotiation and closing process. Get advice from recent buyers. Interview at least two or three agents and ask for written recommendations. When speaking with prospective agents, ask about their experience helping first-time homebuyers and how they plan to help you find a home.
Let us know if these few tips have helped you in buying your fist home in the comments below!