The journey of buying a house is undeniably exciting, filled with the promise of new beginnings and the anticipation of finding your perfect home. Whether you're a seasoned homebuyer or simply a fan of house hunting shows, the process can be exhilarating. However, it can also be daunting, especially in housing markets like the ones we currently face in Arkansas—with lower housing stock and higher home prices.
But, with a well-thought-out plan, a clear vision of your wish list and budget, and the help of experienced professionals and friends, you can successfully navigate the homebuying process and come away with the right home for you and your family.
In this post, we'll explore our best homebuying tips for how to find your perfect Northwest Arkansas home, from basic homebuyer do’s and don’ts to important details, like when to apply for your mortgage preapproval. Keep reading to learn more!
Know What You Want—And What’s in Your Budget
As you begin the house hunting process, it’s important to lay the groundwork for your search, establishing your vision of what the right home looks like for you and a realistic budget.
Determine What Kind of Home You Want
Before you can officially start your hunt, take the time to consider what your ideal home might look like. There are a few major components to consider, including size, type, and quality.
Size doesn’t necessarily equal square footage. A smartly-designed smaller home that utilizes space well can fit a lot more within its walls than a poorly designed large home—and may be accompanied by lower upfront and ongoing costs, too. Instead, think about what rooms you would need today, and if you would like room to grow. How many bedrooms would work best for you? Do you need a home office? Do you entertain guests regularly? What about bathrooms? Because most searches focus on the number of rooms, this is a crucial preliminary step.
In addition to size, you’ll also need to consider what type of home you want. In real estate searches, type often refers to whether a house is detached or attached (like townhomes, condos, apartments, and duplexes). Attached homes may offer less privacy, but also may be more affordable (just watch out for HOAs in some communities!) and easier to maintain. Detached homes may have more maintenance, including yard work, as well as higher utility bills—a tradeoff for potentially more outdoor space.
A final consideration is one that is not included in many basic searches, and that is quality. This can refer to the home’s age, its state of repair, or how long it’s been since its last major renovation. You will pay a premium for newer and recently updated homes—but that can come with the peace of mind knowing your home is move-in ready and will have fewer out-of-pocket costs and issues down the line.
Set a Wish List
Once you have the basic idea of the form of the home you are looking for, it’s time to create a narrower wish list. This will include "must haves", "nice to haves", and "don’t wants."
Must haves are “wants,” but wants that are necessary for you or your family to maintain your lifestyle. This might include staying in a certain school district, having a yard suitable for gardening, or a kitchen and dining room that’s big enough for hosting gatherings. You can also look at must haves from the opposite perspective—the lack of a specific feature would be a “deal breaker.”
Nice to haves are things you would be willing to sacrifice for the right home, but they would be, as the name suggests, nice to have. Think of these as your reach goals. For instance, a finished basement, a guest room, or a garage may be items you would love to have in your home, but you could do without—they aren’t deal breakers. Separating “nice to haves” from your “must haves” can help you stick to your budget. And highlighting them as perks can help you make the choice between two similar homes.
Lastly, think about what you absolutely do not want in a home. Whether it’s a style of home, location or distance from work or school, floorplan, or type of home. This will help your realtor rule out some listings, saving you time during your house hunt.
Know Your Price Range
Determining the budget for your home can involve a lot of different metrics—the least flexible of which is the size of the loan you can be approved for.
Lenders will look at your debt-to-income ratio (DTI) to determine a reasonable monthly payment. In most cases, lenders will want to see you spend less than 36% to 43% of your income on debts each month—the exact percentage will vary based on your lender and the specific loan product.
Your down payment will play an important role in your approval. The larger the down payment, the better the chance of approval. And the more you put down upfront, the lower your monthly payments will be. If you haven’t started saving for your down payment yet, our recent guide can help you develop a plan.
However, just because you are approved for a certain loan amount, doesn’t mean you have to max out your budget. Lower monthly payments will allow more of your income to go toward other goals (like saving for retirement), give you more wiggle room in your monthly budget, or allow you to enjoy a more elevated lifestyle. Use our mortgage calculator to help you better understand how monthly payments, down payments, and home prices relate.
Familiarize Yourself with Your Top Neighborhoods
You probably have an idea of where you want to live—but it’s important to get to know what you’ll get within your price range in your top locations. Investigate homes for sale (and homes that have recently sold) in your ideal locations, taking note of:
- Home Style
- Size
- Price
- Standard Features
- Proximity to Amenities
Use your findings to compare your options, neighborhood by neighborhood.
As you explore your preferred locations, consider expanding your boundaries to see what you can uncover in neighboring areas. You may discover an up-and-coming locale, or you may find that your dollar goes a lot further just a little outside of your choice neighborhoods. If you’re not sure what other places to consider, an experienced real estate agent can help you find additional options, based on your target locations and lifestyle goals.
Attend Open Houses
One of the best ways to familiarize yourself with different neighborhoods, get a better understanding of how far your budget will go, and narrow down your wish list, is to attend open houses.
Open houses are an informal way to explore the market, providing insights into current housing stock as well as your own housing goals. And you can attend them with or without a realtor. Open houses can also be used as practice for checking out homes as your search becomes more serious, helping you differentiate from the glossy and staged real estate pictures posted online and the reality of a physical home.
Work with Professionals
Most homeowners will only go through the process of purchasing a property a few times in their life. While it’s important to be knowledgeable and informed, it’s impossible to know everything about the process. That’s why finding trustworthy professionals, from real estate agents to lenders, can help ensure a successful experience.
Line Up Your Lender and Funding Before House Hunting
When you first start looking at homes, you may think you have time to line up your financing—whether you’re not quite prepared to make an offer or hope that you’ll be able to get your funding in order in a short time frame. However, especially in competitive markets, having your funding (and your lender!) lined up before you make an offer is essential.
Why is this? In tight housing markets, you want the ability to act quickly, making a competitive offer on a hot listing as soon as possible and staying one step ahead of your competition.
Additionally, many sellers will not take an offer seriously if you don’t have a preapproval and may skip your very good offer for one with a better guarantee of funding.
Lastly, there are many different pieces that must come together when purchasing a home. The more you can do in advance, the less you have to do when your house hunt is underway. Important components of securing financing include understanding how home loans work, finding a dependable and experienced lender with competitive rates, selecting a loan product that works for your financial situation, applying for potential funding like down payment assistance, getting your paperwork in order, and, of course, obtaining your preapproval
Completing this legwork upfront can help ensure that you aren’t making rushed decisions with your financing or overlooking programs that can make your home more affordable—mistakes that could cost you thousands of dollars or more over the life of your loan.
Find a Reputable Realtor
To become a realtor in Arkansas, you need to complete 60 hours of training and pass a test. What truly sets apart good realtors is not their license, but their level of experience and commitment to customer service.
A reputable and experienced realtor will:
- Know the ins and outs of the market, helping you make smart decisions on how to make the best offer.
- Find properties that aren’t listed yet or are not on your radar that might be a good fit.
- Help you navigate your wish list and better understand what you’ll get for your budget.
- Spot red flags in a listing that can save you time and money.
Good realtors balance patience with expertise, and care more about getting you in the right home than their commission. And because you will spend a lot of time with your realtor, it’s important to find one whose personality works well with your own.
You can find realtors through word-of-mouth, asking family and friends who have recently purchased a home about their experience. You can also meet realtors at open houses before you begin your search in earnest. When you are shopping for realtors, you can read online reviews to gain better insights. Know that some agents will request for you to sign a buyer’s agent agreement before showing you homes. This is normal, but if you feel pressured, it’s okay to say no. The most important thing is to work with an agent that you trust.
Be Strategic
Buying a home is a huge financial commitment. Because of the scope and impact of your home purchase, you’ll need to be strategic and thoughtful, relying on reason over emotion as you make your decision.
Space Out Your House Hunting
Looking at many houses in one day can make your search more efficient but try to limit the number of homes you tour in one shot. It can be easy to grow fatigued and disinterested when you try to take on too many home tours at once, and you may overlook important features of a possible home, as well as drawbacks.
One way to approach home hunting is to concentrate on one neighborhood at a time. By looking at houses that are close together, you minimize the time it takes to travel from one home to the next, and you can get a better sense of location—and what you can get for your budget there.
Don’t Buy the First House You See
If this is your first-time house hunting, you may be so excited by the prospect of owning your own home, you fall in love with the first listing that you tour.
Maybe you are extraordinarily lucky, and you do find the perfect match in the first home you visit. However, take the time to explore several options to ensure that you’re not missing out on a slightly better fit. Touring homes can be an emotional experience—but to get the most for your dollar, it’s important to keep a level head and choose homes based on thoughtful and practical considerations.
Don’t Buy a Home You Don’t Want
The opposite can also happen. After weeks or months of house hunting, you may become frustrated with your options and put in an offer on a home that is less-than-ideal because you are ready for the search to be over.
Whether it’s the first house you look at or the twentieth, don’t buy a house based on emotions. If you have any doubts, keep looking—the right home will come along with patience and time. A good realtor will help you know what expectations are unrealistic, and when to hold out hope for a better prospect.
Know the House You are Buying—Before You Buy It
Once you have selected a home, the work doesn’t stop. There are additional steps you can take to ensure the quality of the home and the soundness of your decision.
Get a Second Opinion
Ultimately, the decision whether to purchase a house is yours. But, if you’re a first-time homebuyer, getting the opinion of an experienced homeowner, such as a parent or a relative who is handy and knows more about maintaining properties, can be useful.
They may be able to point out issues or questions you missed, provide insights into the reality of owning and maintaining a certain kind of property, or simply act as a sounding board as you weigh your options. Regardless, a second opinion can be a clarifying resource and help you avoid common first-time homebuying mistakes—don’t be afraid to turn to experienced friends and family as you make your final decision.
Inquire About Additional Expenses and Underlying Issues
Beyond the inspection, there are other ways for you to make an informed decision about a potential home. Sellers, who usually have lived in a home for an extended period of time, can offer a wealth of information useful to buyers.
A seller's disclosure—a document that the seller of a property provides to potential buyers that lets them know of any known issues or defects with the property—can help you better understand the condition of the property and potential areas of concern before purchasing it. In Arkansas, sellers aren’t required to make a seller’s disclosure—outside of providing information about lead-based paint. However, your real estate agent can request that they fill out the standard form prior to you making an offer, if they haven’t already.
As a potential buyer, you can also request that the seller provide details about property-related expenses, such as utility bills and HOA fees. This can give you a better understanding or your monthly out-of-pocket costs beyond your mortgage payment, as well as insights into the efficiency of the home.
Don’t Skip the Inspection
In hot markets, you may feel like you need to make the best offer possible, going over asking, waiving contingencies, and skipping the inspection. But skipping the inspection, while an increasingly common practice, is often not a smart choice.
Sellers who jump at a skipped inspection may do so because they have something to hide. And even if they don’t, an inspection can provide you, the buyer, important insights into the functionality of your home, as well as upcoming necessary repairs (like a new roof in a few years), which can help you be a better homeowner.
If you are concerned about missing an opportunity due to requiring an inspection, you can also speak to your agent about putting certain terms within your offer that may be more enticing to the seller, like waiving the first $1,000 in repairs an inspection may turn up.
CS Home Mortgage Can Help You Through Your Homebuying Journey
We’re excited that you’re choosing to buy a home in Northwest Arkansas or Southwest Missouri—and look forward to welcoming you to the community! As you explore your options and navigate the process of buying your first home, know that we’re here to help.
Whether you’re looking for a preapproval or are ready to apply for your mortgage loan, our experienced mortgage lenders can help you find the right financing for your budget and home purchasing needs. Apply online today or visit a convenient location in Eureka Springs, Berryville, Harrison, Huntsville, Holiday Island, or Cassville to learn more.