Seattle Real Estate 101: First-Time Homebuyer’s Full Guide

Are you buying your first home in Seattle? Congratulations! But also, let's be real, it can feel a little overwhelming, right? You've got prices, trends, mortgage inspections, bidding wars, you hear all sorts of things in the news, right? It's a lot to take in. But don't worry, that's exactly why I'm here. I have helped countless first-time homebuyers navigate Seattle's housing market and today I'm giving you a step-by-step guide so you know exactly what to expect when buying your first home. I am Seattle Realtor Emily Cressy with HomeProAssociates.com in Tully Williams, Greater Seattle and I am here to help you feel confident and well-educated and make smart moves when it comes to buying your first property. So ready? Let's dive in. So first, you want to know what you can afford. Before you start looking at homes, you need to get dialed in with where you are financially. And no, I don't just mean looking at how much the homes cost, I want you to look at how much money you have as well. Just because the lender tells you that you can get approved and buy a home at this price doesn't mean that that's going to be what works best for your budget. So you need to know based on what's comfortable for you, maybe a little bit of a stretch, but you don't want to stretch too much and be house poor. So one good move is to talk with a lender early and find out what you qualify for and understand what your monthly payment will be at different price points where you enter the home, the housing market. Don't just focus on price. Seattle home prices will always seem very high but what matters most is your monthly payment and there are down payment assistant programs that can help as well. You want to make sure you factor in things like homeowners association fees if you're looking at a townhouse or condo as well. And a lot of people say, oh I don't want to pay those HOA fees, but remember even if you don't buy a condo and you're buying a regular house, those fees are things like replacing the roof, replacing the windows, painting. So all of that exterior maintenance is something that you should be budgeting for as a homeowner, whether or not you're being forced to save for it through a homeowners association. And as you talk to someone early, they're going to tell you what you can afford based on interest rates today, but be prepared for changing rates. Interest rates affect affordability and your lender will help you understand your best options. You might want to look at fixed rate mortgages, mortgage rate buy downs, where you can pay more up front or have the seller pay more up front and reduce your rate or use an adjustable rate loan, especially if you don't think you're going to be owning the property more than 5 to 10 years. And here's a very important tip, I want to make sure I put this out at the beginning, you want to avoid major purchases like a new car or co-signing on somebody else's loan while you're going through the pre-approval and home buying process because that can totally toast your plans if you do that at the wrong time. So next we're going to talk about choosing a neighborhood. Seattle has so many unique neighborhoods and each one offers a different vibe, a different price point, a different commute time, right? So here are some key things to consider. Number one, budget friendly versus high demand places. Places like Ballard, Kirkland, Capitol Hill are hot, whereas places like Renton or Everett might give you more bang for your buck. If you want to live in those hot places that are close to work and walkable to coffee and all this cute stuff, then you're probably going to be in a condo or a townhouse rather than a single family home if you're on that precipice of the budget because just like everyone else wants those things, those areas tend to get more expensive and they can get bid up and be very competitive. Think about those trade-offs and how they affect you and what's more important to you. Do you need a yard for your dog or do you want to take your dog on the leash and walk him around the neighborhood, right? Something simple like that could be a big impact on where you live and what your lifestyle is like when you live there. Now let's talk about commute and lifestyle. If you work downtown and you're near the light rail, maybe you're in Beacon Hill or Columbia City, you can save a ton of time. Yeah, so you might not even need a car. On the other hand, you know, maybe you and your spouse live in different parts of the city. Maybe one works in Seattle, one works in Bellevue and you're going to live in Linwood or you're going to live in Renton and you've got both great access from a little bit of a less expensive area. Something else to think about is resale value. You know, you're buying this home, it's going to be an investment, you're hopefully going to make a lot of money on it when you go to sell and in-demand areas tend to appreciate faster. If they have great schools, low crime, fun shopping, those are going to be the areas that everyone wants to live and that are going to go up in value. If you're seeing a lot of drugs, homelessness, crowding, other issues, like especially in the city of Seattle right now, then those things might be a deterrent for the next buyer as well. And here's a pro tip, especially if you're not very familiar with the neighborhoods that you're looking at, visit them at different times of day and go to the places that you might go, the grocery store, the library, the parks. What's the traffic like? What is the noise like? What does the community really feel like? Are you safe at night? Getting the vibe of those things before you buy rather than after is a really good exercise. Okay, next we're going to talk about the home buying process. What actually needs to happen to go like, oh, I want to buy a home and now you have the keys and you're moving in, right? How does that work? So buying a home is a process, but it's more than just that weekend house hunt. So here's what to expect. Number one, find an amazing realtor. Congratulations, it's me, you already have. You need someone who knows the market, who fights for your best interests, and can negotiate a deal for you even when things get sticky. Almost every deal has a little hair on it and you need to know how to navigate those things. You want someone who's going to guide you through the process. Next, you're going to work on your home search. So after you're pre-approved with your lender, you kind of know the price range that you're looking in. You can turn on all of those portals, all those instant sites and alerts and pings and bings and start seeing what's available in your favorite neighborhoods in your price range. And this is most people's favorite part. There's something addictive like crack when you're looking at all those houses. Here's a good one, here's a good one, heart, heart, heart, right? So we're going to get on a schedule. Typically, I take my clients out at least once a week and we look at all of the homes that are in your price range that look promising. And I say, let's look at 10 before we get serious, like leave your credit card at home. We're going to look at 10 to learn the market and figure out what's up there or how much house you can get for your money. How big is the bang for your buck in this part of town versus that part of town and really get a feel for the market. And so that way when you do, maybe it's number 11, maybe it's number nine or, you know, like, but usually by that point, people have a sense of the market. And when they see something they like, they really recognize like this has it all. This is much better than the other things that we've been looking at. We want to go after this home and they're prepared to make a strong offer and a fast offer, which is often what's required to win a house in a competitive environment. OK, so you found that beautiful home. Next step is making an offer in Seattle's market. It's called a seller's market in many instances because the advantages to the seller. It's a little tougher for buyers. So I will help write a strong offer that stands out and hopefully we get the first one accepted. Now you have the opportunity for inspections and potentially to renegotiate. An inspection uncovers any hidden issues or problems with the home. And then if there is something we'll try to negotiate for them to fix it or maybe give you a credit at closing so you can pay to have it fixed after you've bought the home. And then finally, it's closing day. Usually closing day is about one month after we've initially put the offer on the home. So a couple of days before closing, you'll sign the final paperwork. You'll do a final walkthrough, make sure everything looks good. You'll get the keys and then we can celebrate because you will be a homeowner. Here's a little tip. When you're looking at your budget and how much money you have, you want to set aside about two to five percent more than you think you need for things like closing costs and just to have a little cash. Once you move into the property, you don't want to be down to zero in your checking account. Right. Murphy's Law. Something's going to go wrong. Maybe we get you a home warranty so that when those things happen, that you are prepared to fix them just to walk up to homeownership. That's how it works sometimes. Step four is I want you to be prepared for market trends. The Seattle market can change. Sometimes it's a seller's market with bidding wars. Sometimes it cools down and a lot of listings are expiring and going off the market. Sometimes as a buyer, you can offer less than the asking price and sometimes you have to pay way more. OK, so here's how to prepare no matter what's going on in the market when you're ready to buy. If it's a seller's market, homes sell fast. So be ready to move quickly and decisively and consider creating offers that involve things like a flexible closing date or rent back to the seller to stand out and kind of make their life easy. So they're inclined to choose your offer. On the other hand, if it's a buyer's market and things are moving slowly, you will have more negotiating power. So we can push for price reductions and seller paid closing costs so that can save you cash out of your pocket and also take a little bit more time and find the best deal and negotiate harder without as much fear of losing out on a good opportunity. Here's the pro tip on this one. Even if you plan to buy in the future, start learning the market now so that you're well educated and when the time comes, you'll know that it's happening and you can be prepared to take action. OK, so that's that's kind of the process. Let's talk about actually getting you into the home. So buying your first home in Seattle does not have to be overwhelming. There's a step-by-step strategy, right? And having the right realtor like me can help you buy with confidence. So if you're ready to take the first step now, six months from now, 12 months from now, you just want to be educated in every part of the process. I would be happy to answer your questions and if you do not feel 100% confident about your purchase, I will not pressure you to move forward by any way, shape or means. OK, my goal is to sell relationships and not to sell houses. I want you to trust me and I want you to tell your friends about me. So comment below with any questions that you have about buying your first home in Seattle and reach out on my website HomeProAssociates.com so that I can be there to help you when you're ready. We'll get to know each other and build that relationship. And when the time is right, whether it's now or 10 years from now, we can still start to get you knowledgeable about what it's going to take video by video, email by email, text message, phone calls, whatever you like. But I am very education focused. I want you to make this decision to be comfortable with. And I'm really looking forward to meeting you and getting to know how I can help you meet your dreams. So until then, I'll see you in the next video.