Owning your first house can be a challenging and intimidating idea for young professionals. In this series, we walk you through the process from mindset to closing the deal, with insights from bankers, builders and real estate agents.
Making this first move correctly can trigger the start of building serious real estate wealth and a set of assets that produce money for generations in your family.
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A few possible starting points not necessarily in sequential order:
1. Recognize that your first house does NOT have to be your dream house or final house. In fact, I would speak with real estate agents to understand what is rentable and what increases resale value long term, then build with that in mind rather than your personal preferences.
2. Decide whether you’re buying or building a house.
3. If you go with building, consider taking it in stages. Identify the land and get at least a rough construction plan done so you have an idea of what it would cost to complete the project in total. Start with getting the land. Then move to construction. There may be ways to leverage that same land as collateral when you’re ready to build.
4. Prepare to enter a period of discipline and sacrifice, and/or get your side hustle running to increase your income so you can save up the $50K (or whatever the initial costs will be).
5. Start the conversation with banks, or if you have access to other financing options speak with them about the options. If it’s not in writing with signatures, it’s just chatter.
6. If homeownership is a serious goal and you have a spouse/partner, get very clear about what you have and what y’all are prepared to do. It’s hard to build a house and build a spouse at the same time. Do it solo, or get a partner, not a second project.
Question of the day: What’s the biggest thing stopping you from owning your first home?
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Essential financial advice for ambitious young professionals.