If you are a first-time homebuyer on a tight budget you may be thinking of purchasing a smaller home now rather than the larger one you truly want to purchase.
While there are some initial financial benefits associated with buying a smaller home now, there are also benefits associated with buying a larger home now. Considering these benefits as a part of an overall Real Estate Strategy & Plan can help you make a more informed decision about what’s right for you and how to proceed when you buy your first home.
Costs Associated with Upgrading in the Future
Some first-time homebuyers choose to purchase a smaller home initially with the goal of upgrading to a larger home later when family circumstances change. This can provide the initial benefits of building equity, taking advantage of tax benefits associated with real estate ownership, and more.
On the flip side, there are costs associated with selling a home when it is time to upgrade, including closing costs, real estate fees, preparation costs, deferred maintenance costs, staging costs, and improvement costs.
Talking to knowledgeable real estate and mortgage professionals will help you to be aware of and consider these and other important factors before you make a final decision on which route to take in home ownership.
Benefits of Long-Term Ownership
For many homeowners there will be a need to move to a larger home in just a few years, such as when starting a family or when younger children grow into teenagers and require more space. Choosing to purchase a home large enough for your family to grow into can enable you to enjoy long-term appreciation and equity growth right from the initial purchase. More than that, the higher value of the home may mean that there is more upside for appreciation over the years.
Home Ownership Costs
In addition to the financial benefits associated with investing in a larger home initially, there are intangible benefits. When you settle down into a larger home that you plan to stay in for many long years or even decades, home ownership costs such as personalizing your home, installing custom blinds and curtains, paint are usually not recurring efforts and costs. Moving into a new home in a few years means a repeat of all those associated new home ownership costs as well as getting established in a new community.
Decision Time – Now What?
There are considerable benefits that can be realized when you make a purchase that you plan to enjoy for many years to come, but there are other factors to consider. Each person needs to make an informed decision regarding a real estate purchase that is best for his or her specific needs, goals, and financial situation, so there is not a best-fit solution that is right for everyone.
If you are a first-time homebuyer and thinking about buying your first home, complete the GET IN TOUCH form on this page and a Real Estate Advisor | REALTOR® from Martin Real Estate Advisors | United Real Estate will help you identify and consider the pros and cons of buying a small home or condominium versus a larger home.
We have the real estate knowledge, expertise, and experience, and the right mortgage lenders, to help you build a Real Estate Strategy & Plan specific to your needs and requirements. We would be honored to represent and guide you through your home buying experience.