Buying your first home can be daunting, but there are a few basic things to look for as a first-time homebuyer. We have five tips to help you get the biggest return on your investment and hopefully have you upgrading when the time is right.

Affordable For an Investment Return

It may be tempting to splurge on a first home and buy something, with say, a pool. But financial experts recommend first-time home buyers go for something more affordable so they can pay it off and eventually make a return on investment.  

The Right Community

Be sure your starter home is in a neighborhood you could grow with for the next five to ten years. While the home’s community may match your lifestyle at the time of purchase, you will want to make sure it could change with your life too. If you plan on having children or even caring for an adult relative, the home should be in a neighborhood with appealing schools or elder care.

Likewise, if you purchase a home in an area with ample nightlife as a single homeowner, consider it may not be the best place to settle down in. We recommend choosing a well-rounded neighborhood that will likely go up in value in the next five years.

Cosmetic Fixer-Uppers

Starter homes are great places to hone your homeowner skills like painting, decorating, and creating curb appeal. Be sure to avoid homes that will need major improvements (i.e. structural and electrical issues) and opt for a home that only needs cosmetic improvements. 

Convenient Location

Not only should the neighborhood reflect your lifestyle, but the location has to be relevant for you as well. Advisors suggest starter homes be located at a convenient distance from your work or friends and family. With less time commuting, you can save gas money to help pay off your home. 

Size Down

Bigger is not always better and according to Realtor.com, smaller homes can appreciate faster. In a home study done by Realtor.com in 2017, homes with less than 1,200 square feet appreciated at 7.5% a year for the past five years. In the same time period, homes with 2,400 square feet or more only appreciated at 3.8% each year.