Many first-time homebuyers can be overly ambitious about what they want to purchase on their first go-around…their dream home! It is understandable, because having a realtor help you search for your first home should be an exciting experience, and you will be tempted to keep upping the ante as you view homes at the upper end of your price range. Give yourself a break! Instead, it can be a good idea to start well-within your price range, because life changes, and it is no fun to be house poor! Purchasing a home that needs some work, but is lower in price, can be a sound investment as you plot your future housing course. You can make needed improvements and updates over time, increasing the value of your home, and you can move up later. You will be building equity in your first home, while not stretching your housing budget to the limit. Building equity in your first home is all the better for your next down payment, enabling you to keep your housing budget on the low side of the scale on your second home purchase. Michael Lerner of Investopedia presents very good advice for first-time homebuyers, with sound reasoning behind that advice, in his article Why your first home shouldn’t be your dream home.
To not stretching your budget to the limit~ Rosemary