By James Sarles
For most people, buying a home is the most significant investment of their lives. And in spite of the doubt and confusion clouding both the financial markets and news headlines, there are many genuine real estate opportunities in the Bahamas and Freeport specifically – especially for first-time buyers. Did you know that Permanent residents with the right to work or Bahamians are exempted from Government Stamp Duty on a home purchase if they are first time home owners and the home is of a value under $250,000. On average, housing inventory is up, prices are stable and historical data on our island demonstrates that purchasing a home has proven a sound long-term financial investment. However, first-time homebuyers are often understandably anxious when it comes time to making the purchase. Here is a simple “do and don’t” list to make the process easier for everyone dreaming of homeownership.
DO:
• DO utilize the internet to arm you with as much knowledge as possible. For example, research all the real estate web sites to see what’s out there.
• DO explore mortgage pre-approval. Getting this early green light will help others involved with your purchase that you are serious about home ownership – and well-qualified. Go visit the banks and find out what they are willing to lend you.
• DO line up your “all-star” team of professionals before game day. A team of experienced professionals will be key to making the home buying process simple and seamless. Start by interviewing and selecting a real estate agent who you “connect” with. That estate agent should also be able to help you indentify suitable lawyers, banks, home inspectors and others who play a role in the process. Make sure to explore the governments first time home buyers stamp tax incentives.
• DO anticipate your future needs and buy for lifestyle. Try to anticipate how long you’ll live in your next home and plan for major lifestyle changes when possible. What may make a perfect starter home for a couple might not work as well when children come into the picture. Remember, people move for lifestyle reasons and your first home will likely not be your last.
• DO hone in on your housing priorities. Your ideal home may have a porch, a pool, ocean views, a dock on a canal and five full baths. But before you start looking, make sure to separate your “must-haves” from your “nice to haves,” so you know where you can compromise to meet your realistic budget.
DON’T:
• DON’T fall in love with the first house or neighborhood you see. That grand colonial with the picturesque view may win your heart at first glance, but don’t fall in love too fast. You need to keep an open mind to make sure you find the right fit for all your needs. At the end of your search, it may turn out that the smaller home in the gated community is a better bet all-around.
• DON’T buy beyond what you can afford. It’s easy to fall into that all-you-can-eat attitude when it comes to your first home purchase. You “want it all” when it comes to size, amenities, location, etc. But remember that your eyes may have a larger appetite than your wallet. Make sure that the down payment, closing costs, and monthly expenses are truly within your income and savings range before you sign on the dotted line.
• DON’T expect too much. It’s unrealistic and unwise to expect your housing investment to appreciate overnight. Buying for lifestyle, as opposed to trying to turn a quick profit, will help ensure that you are viewing home purchasing and ownership in the right context.
• DON’T try to time the market. By the time most consumers sense a major real estate or financial market shift, the tables have typically already turned. Instead of waiting for a slim and unreliable window of time – and potentially missing out on the perfect home – buyers should focus on their own lifestyles and buy when the time is truly right for them. The markets is softer than it was now so this is a good time to buy. If you keep waiting for the market to get worst you might miss the perfect house.
• DON’T jump into an exotic or confusing mortgage. When it comes to down payments and mortgages, if it sounds too good to be true, it probably is. Be sure to read carefully through every aspect of the proposed agreements to fully understand your end of the bargain. Consult your real estate agent and attorney on your deals. Don’t jump into a private Owner Financing Deal for what seems like an attractive rate now may balloon exponentially a few years down the road. So arm yourself with information and don’t be afraid to ask questions.
• DON’T underestimate the value of a trustworthy real estate agent’s on-the-ground expertise. While being a savvy buyer and doing one’s homework will help on the road to homeownership, a local expert with years of negotiating experience is invaluable when it comes to scouting out the perfect home – and closing the deal.
So now you know what to Do and What Not To Do when you buy your first home and for this upcoming weekend here is a little advice… Don’t drink or eat too much and Do Have a great Independence Day Holiday. Until Next Week.
