Mortgage Maestro is always happy to help arrange first time home buyer mortgages. In fact, we consider it a privilege to do so. We know how tough it is to buy that first home when prices are so high and inventory is low. That being the case, a starter home represents a foot in the door of home ownership. First time buyers should not shy away from them.
We get the fact that first time buyers want to get as much as they can with that first purchase. We also understand that the modern world is very much accustomed to the on-demand economy, an economy that stresses personalization and customization. But home buying is a unique endeavor; it often requires compromise. A starter home represents one of the more common compromises.
The Definition of a Starter Home
There is no universally accepted definition of a starter home. So rather than trying to come up with something concrete, it is better to talk about some of the characteristics common to most starter homes. The top three are:
- Smaller Size – A typical starter home is a smaller home with fewer bedrooms and baths. A buyer might be looking at a two- or three-bedroom home with a single bath and an eat-in kitchen. Starter homes do not have formal dining rooms and great rooms.
- Lower Price – Starter homes are more affordable thanks to their lower purchase prices. As such, they tend to be located in older and less expensive neighborhoods. It is not uncommon to buy a starter home in a community of mostly starter homes.
- Renovation Needs – Starter homes are often less expensive because they need renovations. In most cases, buyers are looking at cosmetic renovations, upgrades, and minor repairs.
It is rare for a starter home to offer everything a buyer wants. In fact, this is implied in the name. But starter homes are not intended to be permanent homes. They are intended to help buyers get started on the first rung of the property ladder.
Why a Starter Home Is a Good Choice
There is always the temptation when buying that first home to just go for it and spend the money on everything you want. Yet there are very good reasons to make that first home a starter home. At the top of the list is affordability.
Starter homes cost less. That means first time buyers can come in with lower down payments and still get lower monthly mortgage payments. And because starter homes do not cost as much, their property taxes also tend to be lower. It all works out to a scenario of more affordability.
Also consider the following:
- Maintenance Costs – As long as a starter home is in good mechanical condition, its maintenance costs tend to be lower. You spend less money to live in a starter home.
- Building Equity – One of the main financial advantages of going with a starter home is building equity. As equity increases, so does your financial strength. Building equity is the key to moving up the property ladder.
- Gaining Experience – Owning and maintaining a home is not for the faint of heart. A starter home can help you gain valuable experience you will need to manage a larger and more expensive home down the road.
Here at Mortgage Maestro, we are big believers in starter homes for first time buyers. If you are looking for that first home, we encourage you to consider a starter home. We also encourage you to contact us to learn more about Colorado first-time buyer mortgages. We would be happy to help you obtain a home loan.
