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Start With a Boston Real Estate Broker

There aren’t too many financial decisions that are as complicated as buying a home, but real estate investments can set you ahead in the long run. After all, many people only spend hundreds of thousands of dollars at once a few times in their lives. The sheer amount of money involved dictates all kinds of documents and paperwork that is designed to ensure that the buyers understand their obligations to the lender, the seller, and all the companies in the middle.

The best way to navigate the process is to hire a real estate agent with experience buying and selling homes in the area. They have knowledge of the common forms and how to secure the best deal on the buyers’ behalf. They have negotiated home buying with all different kinds of people, finding ideal solutions for their unique needs. Real estate agents also know how to negotiate with sellers who usually have their own agents. Working with a professional can not only ensure a better result, but it can also saves a lot of time and money. Spending weeks learning about the basics on your own might not make it any easier to find a good home. Being able to rely on an agent to walk buyers through the steps and make sure they understand everything that’s going on ends up being worth every penny in long-term customer satisfaction.

Find Ways to Compromise with Your Partner

Few people are able to find the perfect home at the ideal time. For most buyers, it’s necessary to make at least a few compromises. For example, buyers might have to choose a home that is a bit smaller than they’d like in exchange for a great location. Or, people may decide to purchase in an area that demands a slightly longer commute, so that they can afford to buy a bigger home in a better location. Buyers have to plan for these kinds of compromises, because rejecting anything but the ideal home is likely to result in a fruitless home search.

To set themselves up for success, couples should plan to prioritize their needs and wants from a home they would like to own. There may be instances in which one person’s needs outweigh the other’s, but at first, it makes sense to create separate priority lists. With these lists, couples can compare what they want out of a property and begin to negotiate. If they can sort out the disagreements and come to a consensus before they start actively looking for homes, they’ll be able to limit their search only to homes that meet their basic expectations in a property.

Plan for the Long-Term

When buying a home, the best investment couples can make together is to purchase a property that can grow with them and offer them a good future even if they want to sell it. With the average homeowner sticking with a property for about 13 years, even newlyweds who aren’t planning for kids for a few years should at least consider what sending kids to school will look like in the area. This is a good litmus test for the property’s ability to compete in the years to come as well. Homes in great school districts are attractive to home buying families, which means they’ll be easier to sell. As an added plus, it’s nice to be able to stay put instead of scrambling to find a home in a better district years down the road.

The size of the property and home also matters for couples who want to expand their families (or their interests) in the next several years. People change hobbies and even careers over the course of their lives. A home that will remain useful for a growing family has the flexibility to accommodate this sort of flux. The perfect home might look different among families. Some people might prefer a smaller home and property with a great park nearby, while others want to have several acres so they can really spread out. The key is to find something that isn’t too unwieldy to manage at the present while offering plenty of opportunities for the future.

In looking at any property, couples should also ask themselves, “Where is this property going?” Resale value is a vital aspect of the home buying process, since so few homeowners buying in their 20s and 30s will live in their homes for the rest of their lives. Real estate agents can provide a gold mine of information about any particular neighborhood or area to give an idea of what may happen to the property in the next 5, 10, or 15 years.

When starting to look for homes as a couple, people should plan to balance their current expectations with their future needs. Organizing priorities and hiring an agent makes it a lot less of a hassle. That way, buyers can get a property that fulfills their basic goals as homeowners, grows with them over time, and will catch a good sale price once they are ready.

First time home buyers saving for down-payment

Boston condos for sale: Saving up for a down-payment

Are you looking at buying a Boston condo for sale in the next 12 months? Two years? Three? Whatever your goal, if you’re a first time home buyer in downtown Boston you’re probably going to need a savings plan. 

Good news: New online money-management services can help you reach your goal of piece of downtown Boston real estate. From receiving text alerts when you’ve exceeded your fast-food budget, to getting advice on short-term investments that can help you grow the cash you already have, there’s a product or service out there for you. 

But that doesn’t replace good-old-fashioned planning, combined with a healthy dose of determination.

1. Down Payment Amount

Saving for a down payment? Do you know how much you need?  

The usual number you hear for a down payment on a Boston condo for sale, whether for a Beacon Hill condo or anywhere else, is 20%. In reality, the average person pays less than that up front. According to the National Association of Realtors’ 2018 Profile of Home Buyers and Sellers, the median down payment on Boston downtown real estate is 7% for first-time home buyers. There are excellent home loan programs that start at 5% down. You can find first time home buyer loans under 5% down, but typically the terms are not as good. We strongly recommend saving at least 5% to get the best mortgage rates and terms available. Of course, the very best loan terms are at 20% down or more, but that can be out of the reach of most first time home buyers and is not necessary.

Right now in Charles River Park, the median sales price for a Boston condo for sale is around $450,000, so by very rough numbers, a first-time home buyer is going to need $23,000 to put down. The home buyer will also need to save for additional closing costs to obtain the loan and order the home inspection. A rough figure for that is $7,000, to make an even $30,000 savings goal so you can buy your first home in Portland.

Keep in mind that if your savings plan will take 10 years to produce the down payment you want (and as a real estate agent, I’ve worked with buyers who have saved even longer than that!), home values are going to increase. For 2019, I’ve predicted that home values will go up 3% in Portland, but typical value gains are between 3-8% every year. 

Knowing clearly what you’re saving for is important — as with any goal, the more defined it is, the easier it is to reach. So think about what kind of home you want, look at real estate values for your perfect neighborhood, and look into down-payment assistance programs that you might qualify for.

2. Budgeting Tools to Save

To reach your savings goal, you’re either going to need to start earning extra money, find a suitcase full of cash, or start taking a closer look at your finances and trimming some fat. If the first two options aren’t feasible (or if you need to combine options), the internet is here to help on the budgeting end of things. 

There are two big-name services out there for creating a budget and sticking to it: Mint and You Need a Budget (YNAB). Both sync with just about any bank, so you can see all your spending in one place, split into categories. There are two key difference between Mint and YNAB. The first is that Mint automatically imports all transactions and categorizes them, while YNAB makes users categorize every transaction themselves as a way to change habits. The second key difference is that Mint is free and YNAB costs $84/year.

Mint is geared toward millennials and its big selling point is that it allows you to set your own budget, then alerts you if you overspend in any given category. You can set a savings goal (like a down payment on a home)and see your progress in a fun and visual way. If you’re new to budgeting and want to try a free service, there’s not much to lose by trying Mint —their security standards are top-notch.Like Mint, YNAB allows you to track spending and save for a goal — in fact, they claim that the average “new budgeter” using YNAB saves more than $6,000 in the first year of using their service. Hundreds of internet reviewers attest that the system works. If we had to guess, we would say the key element to this success is the financial education offered by YNAB in the form of step-by-step guides, weekly videos, a weekly newsletter, and a podcast — and all this content is free. There’s also a free trial of the service itself, so you can see if it works for you.

3. Resist the Urge to Spend, Get Your Boston Home Faster

We could lecture you about separating needs from wants, about living frugally and sticking to your budget, but we can’t disguise the simple truth: resisting the urge to spend is hard. The internet is swimming with tips on how to do it, and they’re all valuable — but only by knowing your own habits and motivators will you find the “tricks” that actually work for you. 

Here are a couple we really like:

  • Keep your goal close at hand. Print out some pictures of the Boston condo for sale of your dreams. Stick one on your refrigerator or bathroom mirror. Keep one in your car for when you’re tempted to drive-through Starbucks, and one near your computer monitor (or make it your desktop background) for those online-shopping moments. Finally, wrap a small photo of that dream home around your credit card. 
  • Celebrate small victories. Every journey begins with a single step, right? You can’t expect yourself to stick to a stringent budget perfectly in the first month, but acknowledge when you do manage to hit one of your budgeting goals. Simple rewards will reinforce your hard work.  
  • Keep it fresh. The path to saving for a Charles River Park condo can be a long one. Excitement about a savings goal quickly fades as the months tick by. Keep the momentum going by staying in the loop of whatever excites you about home ownership. Is it having an investment for the long term?

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