5 Habits to Help You Buy Your First Home
Figuring out what matters to you most can help you learn 5 habits to help you buy your first home. Do you buy a car every three to four years? Are you the person who makes and takes lunch to work every day?
Buying a home is one of the best long-term financial investments you can make. Taking a look at your daily habits and spending is the quickest way to prioritize buying your first home.
But what if you’re not sure where to start? Realtor, Sam Wilson shares tips for creating positive home-buying habits and statistics about Denver’s real estate from the December Denver Metro Association of Realtors report.
Tips for Buying Your First Home: Denver Colorado Real Estate Market Statistics
Watch this month’s video and read below so that you can be on the way to buying your first home.
Managing competing priorities can result in delays in reaching life goals. While it’s nice to have new things, is the desire to compete with others or frequent shopping therapy holding you back from personal or financial goals?
Do You Live in Your Car or In a House?
Depending on where you live—in the city or the suburbs—you may or may not spend much time in your car or even own a car.
On the other hand, owning a vehicle may be necessary if you commute to a job, if children attend school or participate in afterschool activities or if you live somewhere public transportation is limited or non-existent.
If you own a car, you might feel like you live in your car cluttered with toys, tools, or work materials. Does running from place to place mean that fast-food containers live on the floor or the back passenger seat?
Spending a lot of time in your car may mean that buying a new car every few years is just something you do. Not having a car payment may not be something you’ve ever considered.
Is the new car sitting in the driveway or on the street preventing you from buying your first home? Imagine what you could do with the money that isn’t going toward a monthly car payment.
What if instead of buying a new car, you save the monthly payments toward a downpayment on your first home and put them in a separate bank account? Is it time to look at routine activities to see if they are taking away or adding to the goals you have for your life?
5 Habits to Help You Buy Your First Home
Humans are creatures of habits that contribute to a fulfilling life. However poor habits or routines can also sabotage accomplishing dreams or goals.
Let’s look at five habits to help you buy your first home.
1 Look at How Much Having Stuff Versus Having a Long-Term Investment Matters to You
Things we don’t use clutter living spaces like closets and drawers. When was the last time you used the air fryer you thought was necessary? What happened to the pair of shoes or top you thought you couldn’t live without?
Spending money to buy things can be an emotional exercise. For example, shopping when hungry can put items in a grocery basket you don’t usually buy.
Are trips to the store every day or every weekend activities? Is shopping a social outlet for meeting friends? Or do you only go to the store when you have a definite purchase in mind?
How much money could you save toward a home downpayment if you eliminated emotional or impulse buying?
2 Buying Fulfills Emotional Needs
Wanting to do something nice for yourself by buying something new can feel great. But, unfortunately, routine shopping can result in overspending and regret when the monthly credit card statement appears.
After all, how many pairs of shoes, pants, tops, or other things do you really need? The answer might surprise you. Will that fifth pair of dress shoes help you buy your first house or end up being one more thing in a closet collecting dust?
Specifically related to clothes, try the wear it or give it away exercise for items hanging in your closet. If you live in a seasonal climate, you may need to do this for warm weather versus cold weather clothes.
Take a metal hanger and a piece of paper. On one side of the paper, write “wear it.” On the other side of the paper, write “give it away.” Tape the piece of paper so that it hangs from the hanger and place it to the far left of your closet.
Then for the next six months, as you wear an item, wash it, hang it up and place it on the left “wear it” sign side of the hanger. Donate items sitting to the right of the “give it away” side of the hanger at the end of six months.
The same exercise can be applied to items in drawers, cupboards, and other places by creating a use and not use section. You can also consider the buy one give one away habit.
For example, if you buy a t-shirt, then you give a t-shirt away. Closets, apartments, and homes are filled with items that are rarely worn out or used up before replacing.
3 Nice to Have Versus Must Have
Like buying a new car every three to five years, many items are nice but unnecessary. For example, buying groceries is necessary; going out to eat is nice but more costly and may not contribute to help you buy your first house.
The next time you buy a coffee or eat out, keep the receipt and write down the amount. Then, on your next grocery trip, compare the value of the items you purchase to the value of the meal.
Grocery shopping may not give you the same emotional high as going out to eat. But if the goal is to save to buy your first house, then watching the numbers add up in a separate bank account for this purpose may give you a sense of self-satisfaction and purpose.
Before you open your wallet to pull out cash or a credit card, ask yourself if the purchase is a necessity or a nice to have.
4 Do You Have an Emergency Fund?
Creating an emergency fund of 3-6 months of income can be a runway to create habits to buy your first home. Habit change doesn’t happen overnight.
If change were easy, everyone would be at their ideal weight. Retirement savings accounts would be filled with hundreds of thousands of dollars instead of tens of thousands.
Habit change comes from regular and persistent action, which means being intentional daily to achieve the long-term goals you want instead of spending and living for today.
Set a goal if you don’t have an emergency fund for a rainy day or a potential loss of income. Go through every bill, credit card, and bank statement and create a spreadsheet. Add to this one-time or irregular expenses like oil changes, car repairs, and dental bills.
Unexpected bills can easily detract from setting aside money in a savings account. Creating the spreadsheet and reviewing it every week can help identify areas where you can save more money or where you might be spending unnecessarily.
5 Pay Bills on Time
Credit cards are magical. You put the card in a machine, and voila, the item you want leaves the store with you.
Instant gratification feels amazing until the bill comes due. If you can’t pay off your credit cards each month, consider your buying patterns.
Being buried in debt can feel stressful. Create a payment plan and stick to it.
Digging yourself out of a spending pit will feel amazing when you are debt free. Then, that money you paid every month—for things you already own and may not use—will help you buy your first home.
Create a Home Ownership Plan
Buying a house is a significant long-term financial investment. While new cars decrease in value the minute you drive them off the lot, a home can increase in value over time.
If buying your first or next home is a goal, there’s no time like the present to look at habits that can help you get there faster.
Establish a long-term relationship with a realtor 6-12 months before you are ready to buy. This action will help you ensure that all of the steps, like being pre-approved for a mortgage and creating an ongoing home maintenance budget, become part of your home ownership plan.
There’s No Time Like the Present to Buy or Sell a Home in The Denver Metro Area
Are you considering buying or selling a home in the Denver Metro Area? Get expert real estate advice from Sam Wilson, who has more than twenty years of experience in the local market, and his team of realtors.
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