Answers to the Top 9 Questions New Home Buyers Have

New House Buyer Photo by Ann Wallace on Unsplash

Buying a house is a big deal no matter what. When it’s a first home, it can be overwhelming and even scary. We are here to help calm the anxiety and demystify the process.

At Berkshire Hathaway HomeServices Select Properties we hear the concerns that keep our clients up at night. It’s clear that, the more people know about the process, the more confident they are to make the big decisions necessary to find and purchase a house.

Below, we tackle 9 of the most common questions we hear from first-time homebuyers, and provide answers and resources for each.

1. What is the Home Buying Process Like?

One of the biggest concerns for a lot of new home buyers’ is simply not knowing what to expect. Fear of the unknown includes worrying about forgetting an important step, or feeling like they might ask a stupid question. 

This is normal and there is no shame in asking questions. Unsure what a certain abbreviation or acronym means? Not sure when to have an inspection done? Ask your real estate agent. Even people who have bought a house in the past might need to brush up on the procedures and jargon that is unique to the real estate industry. And remember: If asking your real estate agent questions is intimidating, or if they aren’t good at communicating the answers, you might not be working with the right agent. 

The Berkshire Hathaway HomeServices Select Properties’ blog archives are filled with helpful articles that lay out the home buying process step by step. Some are even written specifically for first time home buyers:

Homes for First-Time Buyers: Everything a Rookie Should Know

St. Louis Real Estate: Do’s and Don’ts for Buyers

What Are the Best Types of Homes for a First-Time Home Buyer? Finding What’s Right for You

And even though this was written in 2021, the basic advice has not changed and the tips are still relevant:

How to Buy a House in 2021: Home Buying Basics

2. Some Homes are Listed as “Pending” or “Contingent.” Are They For Sale or Not?

As mentioned in #1 above, the real estate industry uses terms that can be confusing to some. When a first-time homebuyer sees that a home is listed as pending, contingent, or under contract, they may wonder if it is worth pursuing. 

These statuses mean that there is an offer on the table and the house is getting close to a final sale. However, there are a number of things that can happen that make the sale fall though. In many cases, it is still possible to tour one of these homes, and even make an offer. 

The best thing to do is check with the real estate agent. They will know the exact status and whether or not the seller is entertaining further “backup” offers. This article breaks down the different terms:

So is the House for Sale? Pending, Contingent, and Under Contract in Real Estate

3. How Much House Can We Afford?

The excitement of house hunting can make it easy for first-time buyers to get carried away and lose sight of their budget. They might convince themselves that they will quit eating out or forgo vacations for the next 10 years in order to afford the house they’ve fallen in love with. While buying the perfect house might mean some sacrifices, the last thing a new home buyer needs is to risk their financial future as they struggle to pay the mortgage each month. People need to be realistic about how much is too much to pay. 

Figuring out a price range to shop for involves calculations that take into account salary, debt, and savings. There are a number of online mortgage calculators that can help. The following article can help put things in perspective too, with guidance about affordability in the St. Louis region:

How Much House Can You Afford in St. Louis?

4. Our Credit Is Not So Great. Does It Matter?

A bad credit score can make buying a first home challenging. That doesn’t mean it can’t be done. Yes, lenders look closely at debt to determine what, if anything, they are willing to lend. But they also consider savings and income too. 

There are things a new home buyer can do to improve their credit and help secure a mortgage loan. Also, federal agencies like the Federal Housing Administration (FHA), Veterans Administration (VA), and U.S. Department of Housing and Urban Development (HUD) can help those who qualify. This article helps shed light on how bad credit affects the homebuying process and some advice on what to do about it. 

Can You Buy a Home With Bad Credit?

5. Everyone’s Saying it’s a Seller’s Market. Is it a Bad Idea to Buy Now?

New home buyers have almost certainly heard some horror stories about a “hot seller’s market.” Simply put, a seller’s market means there is not a lot of inventory available, pushing demand and prices up… which favors the seller. The result is houses being snatched off the market before viewings can be scheduled, or buyers paying way more than the asking price. First-time buyers might wonder if they’ll ever find a house that they want at a price they can afford under these conditions. 

Experts are not sure how long the current market will last. But with the right preparation and some patience, finding a first home is possible. Read this for some tips: 

10 Tips for Buying a Home in a Hot Housing Market

6. What are Closing Costs and How Much Will They Cost Us?

New home buyers are not always sure what to expect at closing. Basically, the buyer and seller finalize the sale with a lot of paperwork, and transfer money in exchange for the keys to the house. There are also administrative fees to pay. Luckily for the buyer, the seller is responsible for most of these, including the buyer's agent commission.

In this article, we break down all of the costs payable at closing, and who pays them: 

Buyer, Seller, or Both—Who Pays the Closing Costs?

7. With Things Like Zillow, Do We Need an Agent?

Real estate listings are among the many things that are available online these days. Websites like Zillow, Trulia, and Redfin can make it seem to new home buyers like they do not need a real estate agent. While these sites can be great for the start of a search, it is best not to put too much stock in them. They are no replacement for the personalized service of an agent who can get to know their clients, answer questions, and guide them through every step of the home purchase process.

Here are two articles that explain the benefits of finding an experienced agent, and the limited scope of online home resources:

3 Secrets for Finding the Best Real Estate Agent in Town

3 Reasons Why You Shouldn’t Rely on Zillow

And did you know that just because a house is for sale by owner, that does not mean that a buyer can not have an agent. In fact, it is highly recommended. We explain it all here:

When Buying a Home "For Sale by Owner," Here’s What You Need to Know

8. Which is Better for Homebuyers? Illinois or Missouri?

Keeping an open mind is important when searching for that first house. In our region, that can mean contemplating a move across the Mississippi River. Both the St. Louis region and the Metro East in Illinois have every type of home covered. So which is better? It all depends on what a buyer is looking for. 

We’ve compiled the stats on the cost of living, commuting, schools, and more in these two articles. We’ve also compared the two states’ real estate rules and regulations:

Choosing Between Missouri and Illinois—What is Life Really Like Across the River?

Buying or Selling a Home in Missouri vs. Illinois: What’s Different?

9. Is Buying a House Supposed to Be This Stressful?

The amount of uncertainty and anxiety involved in buying a home can be a big surprise to a first-time buyer. Is it always this stressful? Unfortunately, stress comes with the territory. It is possibly the biggest decision a person can make. 

This article will help put things into perspective:

Yes, Buying a Home is Stressful (Too)

Buying a Home is Exciting

Being a first-time homebuyer is exciting. It can also be stressful, nerve-racking, exhausting, and frustrating. 

First, learn about the process. This alone will do a lot to make it seem less intimidating. Next, consider your goals and finances in order to form a plan and a budget. Finally, find a knowledgeable real estate agent to lean on. Berkshire Hathaway HomeServices Select Properties has agents ready to smooth the way and find you your dream home.

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