Safeload Coverage
Becoming a first-time homebuyer is a huge milestone for many people. Getting there is a challenge for most first-time homebuyers. It’s not as simple as finding a house for sale, putting in an offer, the buyer accepting the offer, signing all the dotted lines, and moving into the new home.
Before you begin your homebuying experience, the Moving Help® Marketplace will provide you with 10 pros and cons when it comes to being a homeowner. This guide should give you a better idea on whether owning a house is right for you.
What Is a First-Time Buyer?
A first-time buyer is someone who has not owned a primary residence in the past three years. Typically, most first-time homebuyers have never purchased a house previously.
A first-time buyer may have some other qualifications such as being a single parent.
10 Pros and Cons When It Comes to Being a First-Time Homebuyer
We’ll provide 10 total pros and cons for each point when it comes to being a first-time homebuyer. While having that dream white picket fence is wonderful, it’s not always roses and sunshine when you become a homeowner instead of being a renter, especially with the cost of living rising every day.
1. First-Time Homebuyer Loans
The first point is first-time homebuyer loans. You can make a smaller or larger down payment, but all the costs are way higher than being a renter. With that said, first-time homebuyers do receive some benefits and help from certain programs for their new home.
Pros: First-Time Homebuyer Programs
You aren’t required to put down 20 percent of the house’s total cost for a down payment. It’s just recommended you put down 20 percent. Additionally, first-time homebuyer programs exist to help new homeowners. Using these benefits and resources can make the buying process easier.
If you must put a lower down payment, have a credit score issue, and have a higher debt-to-income ratio, these programs could be helpful. You also could receive a lower interest rate when you don’t have some of these issues.
Cons: Larger Down Payments
A down payment along with closing costs will always be significantly higher compared to renting. When you rent, you put down a security deposit, first and maybe last month’s rent, a pet deposit, and some other fees.
This isn’t an insignificant amount. It’s just going to be less money spent overall compared to home buying.
Depending on the type of house, a down payment could be more expensive than all those items listed above that’s needed for rent.
2. You Own the House
The best part about buying a house is you own the property. Of course, you don’t fully own the house and the property until the loan is paid off, but you’re one step closer to 100 percent ownership. Owning a house also can help with taxes.
Pros: You Build Equity
When you own a house, you can build equity into your home. You’re paying your own housing mortgage and not a landlord’s mortgage. Finally, you can pass this house down as an asset to your children.
Building equity can be helpful and important for homeowners. You can use that equity for multiple purposes.
Cons: You Pay for Unexpected Expenses
On the flip side of owning a house, you must pay for everything. If you have an unexpected expense such as your water heater leaking, you not only have to find someone who will fix the water heater, but you’ll have to pay them yourself as well.
Unlike when you’re renting, your landlord is responsible for these types of repairs. The landlord is in charge of all maintenance in general as well. Now as a homeowner, you’re responsible for these repairs.
3. Privacy and Control
When you rent, you typically have neighbors on the other side of your walls, usually having at least one to three neighbors near you at all times. Owning a home means you get more privacy and control. Although, you still have rules to follow because most homes are inside an HOA these days.
Pros: No Neighbors on the Other Side of the Wall
The best part about owning a home is you don’t have neighbors right on top of you. You get plenty more privacy. You also get to control the inside of your living arrangements. Do you want to paint your living room walls red and your bedroom walls orange? Then you get to paint to your heart’s content.
You also get to control your living arrangements and what you want inside your own home. You don’t need permission from anyone when it comes to the inside of your home. Although, you may need permission from the HOA for what you do to the outside of your home.
Cons: Must Maintain Appearance
While you get plenty of privacy and control, you must maintain your home appearance. That means you must make sure your roof doesn’t have any issues, and your home doesn’t have any structural issues in general. You must keep up with lawn care, gardening, and outside appearance.
If you live in an HOA, you may have other rules that come with homeownership such as setting out and bringing in your trash can at certain points of the day. You may have limited choices on what type of grass, plants, and trees you have in your front yard and backyard.
4. No Abrupt Moving
When it comes to owning a home, you don’t have to worry about moving, which can be good and bad depending on your circumstances.
Pros: You Can Stay in Your Home Forever
When you live in a house, you can live there as long as you want to be there. Of course, you just need to make your home mortgage payments and any other bills on time. You never have to worry about moving.
You also don’t have to worry about a landlord raising your base rent pay, selling the property, or kicking you out after your lease is over because they want to change the property to something else.
You can plant your roots down without worrying about your lease ending and what to do when your lease is coming to an end.
Cons: You Can’t Move Away Easily
While you can plant your roots and you don’t have to worry about your lease ending, you can’t move away as easily. When you rent, you can move somewhere else when your lease ends, and you give notice to leave.
When you own a house, you can’t move away immediately. You must sell your house. Selling your house is a process. Sometimes, this process can take several months while you find a new home in the future.
Remember: Location, location, location.
5. Neighborhood Vibes
Your neighbors can be a positive or a negative aspect. At an apartment complex, you can have great or terrible neighbors. Your neighbors also can change frequently at an apartment complex. When you own a home, your neighbors are less likely to change as often, which can be great.
Pros: You Get to be a Part of a Community
When you live in a neighborhood, you get to be part of a community. You also get to see the same constant, nice neighbors next to you. This consistency is great. While you could have some not-so-great neighbors, you can at least have some privacy away from them inside your home.
Cons: HOAs Can be the Worst
On the other hand, HOAs can be awful. More and more communities have houses and neighborhoods that live inside an HOA. HOAs certainly have positives and negatives about them.
If your HOA isn’t helpful, friendly, or is poorly managed, this can put a damper on your living space. Different HOAS can have different HOA fees. It’s true what they say: Do your research and make sure to pick your HOA community carefully.
Have a Real Estate Agent in Your Corner
To help you with your homebuying journey, first-time homebuyers should hire a real estate agent. A good real estate agent will understand the housing market, know the neighborhoods you’re potentially considering, help with the buying process, create offers, and negotiate your lease terms.
That’s why having a real estate agent in your corner is critical.
Just like how Moving Help has Service Providers in the United States and Canada, Zoocasa serves Canada and the United States. Zoocasa has real estate agents who understand what it takes to find the right house for you.
Good Luck With Your First-Time Homebuyer Experience
Being a first-time homebuyer isn’t easy. It’s also super rewarding. While it can take some time to finish the process from start to finish, it’s worth the wait.
These 10 pros and cons guide from the Moving Help Marketplace can not only help you determine whether you’re ready to take that leap from renter to homeowner but also whether this is a challenge and a reward you want to take on yourself as a homeowner.
Good luck with your homebuying process.
