Tips for Las Vegas First Time Homebuyers
If you’re a newbie to Las Vegas or a first-time homebuyer (or both), here are some tips to help get you started with your home buying process.
Before you start looking for your first home, it’s important to make sure your credit is fit. Good credit can lower your mortgage interest rate, potentially saving you hundreds of dollars each month. Start by ordering your credit report and consulting a professional for advice if there are any discrepancies. Then pay down as many bills as possible. Be sure to save for your down payment (3 percent to 20 percent) and closing costs (1 percent to 2 percent of price).
We suggest these 2-3 online credit-checking companies:
Get Your Home Buying Team in Place
Just as any successful athlete needs a good coach, you’ll need to assemble your coaching team to guide you in your Las Vegas home buying process. This should include a qualified Las Vegas realtor and lender. If you don’t have a referral, visit some of the neighborhoods you have your eye on and ask for recommendations. The Greater Las Vegas Association of Realtors® is also a good resource.
You don’t want to miss the opportunity to purchase your dream home because your financing isn’t ready. According to Brad Malkin, president, Noble Home Loans, if he could give one piece of advice to first-time homebuyers it would be to “start the prequalification process early.” Your lender will help you choose the best mortgage for your situation and calculate how much house you can afford (buyers should spend no more than 25 percent to 30 percent of their pre-tax income).
You can get pre-qualified by more than one lender, but you want to avoid too many credit inquiries as it can create future issues with undisclosed debt to your lender and lower your score. Also be sure not to make any major purchases or move money around 90 days before you buy. This can be a red flag to lenders and can sometimes affect your ability to get a loan approved or closed.
Research Assistance Programs
A good option for first-time homebuyers is a loan from the Federal Housing Administration (FHA). Designed to promote home ownership, FHA single-family mortgages in Nevada can have down payments as little as 3.5 percent. There are also several grants and down payment assistance programs available for the Las Vegas first-time homebuyer who might not otherwise be able to afford the down payment or closing costs. Each program tends to have its own set of guidelines (maximum income, minimum credit score, specific geographic area, interest rate, etc.) Malkin stresses, “the important thing for buyers to understand is that they need to read the fine print and make sure they are comfortable with the terms.” Here’s a list of some of the non-profit organizations that outline these programs:
- Financial Guidance Center, https://www.cccsnevada.org/
- Nevada Housing Division, http://housing.nv.gov/
- Housing for Nevada, http://www.housingfornevada.org/home-buyers/
- Neighborhood Housing Services of Southern Nevada (NHS), http://nwsn.org/homeownership/
Choose a Home that will Grow with your Needs
Once you have your financing in place, it’s time for the fun part – choosing your home. Dana Limon, luxury home specialists, Southern Highlands Reality, encourages home buyers to tell their realtor as much as possible about their lifestyle so he or she can guide you toward the best fit. If you’re a lake person, you may want to select a community closer to Lake Mead. If you love the mountains, consider Northwest Las Vegas master planned community Skye Canyon, located near Mt. Charleston and the Lee Canyon ski area.
Life happens, so it’s important to choose a house that accommodates your short- and long-term needs. Are you planning to have kids? If so, be sure you’ve got ample space for kids’ rooms and a playroom. Might you need to care for aging relatives or houseguests? Consider a lower-level guest room. Consider lot size, number of bedrooms and bathrooms, nearby schools and community amenities, all of which can affect resale value. The key factor is to look for a house, which will fit your growing needs as an individual, or for your family.
Shop New and Resale
Keep your options open when it comes to purchasing new versus resale. “I encourage home buyers to look at both resale and new homes, and crunch the numbers,” says Limon. “A new home includes a warranty so you won’t have to budget for hidden repair surprises up front. If you are looking at resale homes, make sure that you have the money to fix it up.” It’s always a good idea when purchasing a used home that you have money set aside for repairs and maintenance issues, which could come up.
Upgrade Wisely and Timely
If you’ve always dreamed of real wood floors, plush carpets or an epoxied garage floor with built-in cabinets, remember it’s a lot easier to make those upgrades before you’ve moved in with your belongings. If you’re buying a brand new home, ask about builder incentives, which can range from discounted upgrades to help with closing costs. If you’re planning to pay for upgrades yourself, be smart with financing them. One type of loan, called an FHA 203k, allows you to finance some upgrades into your mortgage. Other options are getting an interest-free credit card from a home improvement retailer, but be sure to pay it off in time to avoid a hefty interest rate. Las Vegas housing values are on the rise (source: Las Vegas Review Journal, 1/26/16), but most experts agree it’s best to avoid taking out a home equity line of credit that banks on future home value.
Opt for Las Vegas-friendly home and yard features
If you’re shopping for a home during the summer, you’ll probably pay close attention to those homes with community or backyard swimming pools – or both. Las Vegas homebuyers should consider homes with energy efficient air conditioning units and window coverings. If you’re buying a two-story house, consider a home with dual cooling units, which can minimize your utility bill. Many people relocating to Las Vegas from out of state don’t realize that we enjoy all four seasons here, including crisp winters – so don’t forget to consider a cozy fireplace, which can also improve resale value.
Many Las Vegas communities also have gorgeous views ranging from the bright lights of the Las Vegas strip to the majestic beauty of Red Rock and snow-capped Mt. Charleston.
Another pro of buying a home for the first time in Las Vegas is low property taxes, which are just under 1 percent of the value of the house. Las Vegas has a wide selection of new and resale homes for first-time homebuyers to choose from. If you’re a first-time homebuyer newbie, Las Vegas is a great place to shop for your first home.
For more information on master planned communities with amazing amenities (hiking, biking, proximity to the mountains, and a real community feel), consider Skye Canyon. Contact us now for more information on Skye Canyon and what it’s like to live and work in Las Vegas, Nevada.