Affordability Options For First-Time Buyers

Fixer-Uppers and Smaller Homes

First-time home buyers who want affordable homes may want to take a hard look at fixer-uppers, smaller homes and cheaper commutes to work to save on the costs of buying and owning a home.

Real estate brokers say many home buyers expect more than they can afford in a home and once they start pounding the pavement for housing their disconnect could be discouraging.

In an recent survey of 150 of real estate brokers, some disturbing trends were discovered among first-time home buyers. While nearly half of the brokers surveyed said affordability was the number one concern for first time buyers, 81 percent of those buyers also consider move-in conditions to be very important when searching for homes. Only 7 percent are considering fixer-upper homes.

This data suggests more buyers should examine the fixer-upper option -- among others -- to get the affordability they seek.

In the past, first-time home buyers were willing to purchase older, more basic houses in an effort to save money and break into homeownership. It is important for first-time homebuyers to remember that by considering a fixer-upper for their first home purchase, they can build equity over time and later move up and into their second-stage home that better reflects their expectations

Buyers looking for affordability who go with the fixer-upper option should get the home professionally inspected to determine what fixing up is necessary, and certainly not bite off more than they can chew. Even homes that need a basic face lift -- paint, carpeting, landscaping, window treatments and other cosmetic touches -- can come with big savings. Homes that may require professional upgrades cost even less, but the buyer has to weigh the discounted price against the cost of the improvement.