HOME / Serving the first-time buyer
Barbara Baker, Camille Colvin, Bret Llewellyn, and Michelle Winer share expertise
From top: Michelle Winer, Brett Lewellyn and Barbara Baker
Photos by Stephen Gabris
Buying a house can be overwhelming for anyone, but for the first-time homebuyer in a quickly moving market, it can be hard to know where to start, who to trust, and when to pull the trigger on a decision they’ll be living with for years to come. To demystify the process and minimize anxiety, we talked to four local senior real estate agents with more than 100 years of experience among them.
When you meet a first-time homebuyer, what initial questions do you ask, or what advice do you offer?
Barbara Baker: I give them an assignment, especially if it is a couple. They aren’t allowed to discuss their answers with each other and have to answer, “What are your ten must-haves and your ten absolutely-nots?” Then we have discussions that guide the process.
Camille Colvin: I tell them it’s one of the smartest things they’ll do in their lifetime. Rent is wasting money, and you should save as much as you can. The more you have to put toward your endeavor, the better. We are in the city where real estate has always been a fabulous investment.
Bret Llewellyn: If buyers don’t know what type of home they qualify for, I do a brief analysis of where they might stand and give them a card of a mortgage professional.
Michelle Winer: Where are they going to be working? What is their lifestyle like? Do they want to live in the city? The questions flow based on where they will work, and what is important to them.
What are the top things first-time homebuyers should consider?
BB: The most important thing is where their ideal payment level is. Ninety-five percent do end up buying a house. The other five percent decide to rent longer because they’re not ready.
CC: Where do you want to go? Why do you want to go there?
BL: Think about your lifestyle: Where do you work now, and where would you like to live, work, and play in the future? If a family is in your near future, what amenities will you need and what type of schools do you see your family growing up in? What is on your “absolute needs” list and then what is on your “want” list (think bedrooms, baths, garage, lawn, style of homes you like or dislike)?
MW: I always tell clients to “pick two”: cost, condition/quality of the property, and location. Which of these two (cost, condition, or location) are most important? Let’s start with that.
Should a first-time homebuyer be pre-approved by the time they connect with you?
BL: This is one of the first questions I ask: have you reached out to your bank or mortgage company? They should be prequalified at least! Pre-approval for a mortgage is highly recommended with the shortage of inventory; it will help in multiple-offer situations.
CC: You can certainly start talking with an agent, but one of the first things you will need to do is get the pre-approval.
BB: It helps to sort out assets and liabilities. For example, is a $1,200 a month payment a no-brainer, or does it mean you’re making mac and cheese five times a week? I always offer a couple of mortgage broker recommendations. Unless someone has a preferred private banker or works for a company that uses a specific bank with benefits to employees, do some comparative shopping.
MW: Go to the realtor first; because we’re connected with that world, we can give good recommendations. The money is a big thing: first-time homebuyers often go after the FHA loans because they require less down, but it’s often better to get a conventional loan. There is so much competition and a lack of inventory right now, so it’s better to be ready.
Do you offer guidelines to your clients to figure out how much they can afford? A certain percentage of their income, for example?
CC: We used to do a qualification for them, but that whole process has changed, and now they go to a mortgage rep.
BL: Real estate agents are not bankers or mortgage consultants, but we can give them the basics of what to expect when questioned by a financial advisor. Things like, how much do you make per year? How much money do you have saved? Do you know what your credit score is? What debts do you have? Seasoned agents can advise, but recommending professional help is the best thing we can do for them.
BB: I don’t like those specific percentages. Sometimes a doctor or teacher is just starting out and their earning power is ahead of them, so it’s good to think about that. We just have to be realistic; you may be able to cut back for a few years in other areas, knowing your income will be growing, but what can you realistically do?
How do you advise first-time buyers regarding new builds?
BB: While I wouldn’t talk someone out of it, they are going to get a better investment if they buy in a smart area that is still growing.
CC: New construction is the most expensive way to go, and there are always costs over and above what the builder is telling you: the lighting allowance, carpeting allowance, patios, landscaping. Inevitably, you will go up in price and you need to be ready for that.
MW: And that’s aside from a larger down payment and closing costs.
BB: It also requires a great deal of time. Do they have that time to be away from their office or job when issues come up? It’s fun, but people often have no idea what they’re getting into.
BL: In eighteen years, I don’t think I have ever taken a first-time homebuyer into a new build. The cost is normally outside of their budget.
There are probably a lot of situations where dreams clash with reality. How do you navigate that?
BL: This happens with every first-time homebuyer! The big lawn, the fenced lawn, the fireplace, the open floor plan, the two-car garage, the large closets, the deck or the covered porch. The younger first-time homebuyers are normally drawn to a walkable community, and some of their wish lists are just not realistic in these areas. Good agents need to be patient and let them realize themselves that some items on their wish list will probably not happen with the first home. We can only suggest trade-offs; you may not get that open floor plan in this price range but you’ll get that two-car garage.
CC: We have a joke that “buyers are liars.” We don’t mean that they lie to us but, in their heads, they think, “I have to have this. This is a must!” And then they buy something completely different from what they told you. Sometimes, when a house is put together well, it might be the total opposite of what you thought you wanted. The secret is to be a little bit flexible.
BB: Sometimes one person wants a fenced in yard because they were hoping to get a dog, and their significant other didn’t even know they wanted a dog; all they were thinking about was a house with bigger closets because they were sharing a tiny little closet before. We work through all of that.
MW: I help them to look for other things, like good windows, a new furnace, the roof. The expensive stuff that they might not be thinking about.
What in the current market in Buffalo should first-time homebuyers be aware of?
BL: The city of Buffalo has been extremely hot, and every house with a roof has been in a multiple-offer situation. I had one first-time homebuyer who lost seven multiple-offer situations. We had one small home that had thirty-one offers. The main suburbs are still hot and, if they are priced right, they are going to sell fast. You need to be prepared to view a new listing the day it gets listed and be ready to put in an offer by the end of the day.
BB: For a while, the city was so hot it was unbelievable, especially if someone was looking for a double or a triple; they were going to pay way over the asking price. It has slowed down a bit. I tell my clients be aware of the dollars you are willing to spend and be prepared.
CC: It can be discouraging. There are more people at the lower part of the market, so that can be tough. Know what you want to offer. I tell them, “We’re going to have to work at this together. I’m going to let you know if you should overpay or walk away.” You really need to trust your agent in this landscape. Know how high you will go, but also be smart enough to walk away.
MW: It is busy, but there are tons of areas of Buffalo that are still untapped. The First Ward will be hot soon. And Riverside, along the canal. There are sections of South Buffalo that are beautiful. Expanding your search can help.
If you could offer just one piece of advice to a first-time buyer, what would it be?
BB: Know your finances. And then think about the big picture. What is most important to you? Is it location? Schools? Commute time? Condition? What will your quality of life be day to day?
CC: Buy the house. Don’t be afraid of this process. Try to have fun with it all!
BL: Reach out to the people you trust and get referrals for real estate professionals (agents and mortgage brokers). Meet with them and interview them. You’re going to be spending a lot of time with them and making the largest purchase you’ve ever made. You need someone you can trust to lead you through this process.
MW: Pay attention to where you are financially. Be flexible. Inventory is low, but don’t be afraid. Always do a home inspection; I’ve seen too many deals where people forgo inspections to try to win the house. I never want a first-time homebuyer to pull an inspection!