Tips for First Time Homebuyers

In the Bay Area a starter home can cost upwards of $3 million, which can make your first home purchase a daunting task.

Adding to the complexities, this area has its own eccentricities (e.g., offer price often exceeds the list price, no contingencies, quick close). To make the process painless and more manageable, while enhancing your chances of success, consider the following tips:

1. Select the Right Allies

As with any endeavor, it’s crucial to select the right allies to assist with your journey. This starts with finding the right Realtor®. As a first-time buyer, you will not only need someone who is sharp, local to the area, well-connected, and tireless, but also someone with patience and the ability to teach. Where a seller of a $10 million home may be best suited working with the most dominant agent in that neighborhood, the first-time buyer may need more attention and hand-holding than that same listing agent is able to provide.

Another important team member is your lender. A good lender will not only creatively tailor your loan to your needs, but also assure that your offers are as strong as possible. I recently represented a young family through their first purchase in Mountain View. I connected them with a strong local lender who quickly got them approved and underwritten with strong terms. When the listing agent called to congratulate me with an accepted offer, he noted that it was his trust in our lender (whom he had known professionally for many years), coupled with our fully underwritten approval that pushed our offer past close competition. This lender played an invaluable role in getting their offer accepted successfully, and with no counter-offer!

2. Make Thoughtful Concessions

First-time buyers often begin with the idea that they will find a flawless home. One of the most important lessons these clients learn is that they will likely have to make concessions in order to secure the right property for the right price. Whether that be overlooking a curable inspection report item, or accepting the perfect home on a semi-busy street, the trick is in knowing what you are willing to concede and making thoughtful decisions based on sound advice.

New buyers will often be unnecessarily deterred by issues such as small cracks in the foundation. While they seem scary and can deter competition, these cracks are actually very common throughout the Peninsula where a large portion of existing homes were built in the 1950s, and can likely be inexpensively remedied with some epoxy. Conversely, a property that needs a new roof, or with plumbing issues buried in a concrete slab foundation, may be enough cause to move on. Understanding the difference between a deal breaker and a curable issue is a recipe for success.

3. Be Patient, but Prepared to Move Quickly

Despite the record-low inventory over the last several years, I still recommend a patient approach and encourage my clients to cast a wide net geographically to begin. If you love Palo Alto, you may also love the Willows neighborhood of Menlo Park, or the Martens-Carmelita neighborhood of Mountain View. Don’t be afraid to explore some inventory and pass on a few properties until you get your “sea legs.”

At the same time, be aware that you may need to move quickly if you find the right home. New properties come on the market every week, and you may have to pivot quickly when the time comes. Chances are if you like it, so do other buyers in your price point.

4. Seek Deals in the Fall and Winter

My last piece of advice is to keep looking when others have given up. By the time the market turns toward the fall and winter months, many buyers will have decided to throw in the towel until the new year. Keep your eyes open for sellers who have become anxious as their property sits on the market. What may have been out of your budget in March, may now sell at a discount. And getting a good value now will lock in instant appreciation when the prime spring market arrives in the new year.

As a recovering attorney who only represents buyers, I have the time, resources, and expertise necessary to ensure your success. Contact me today at (650) 847-7407 or to find out more about how I can get you into your first home.

By Alexander Lewicki


Michael Repka | Tel: 650.405.4631