Laura Rowley at Yahoo! Finance has written an excellent piece on buying a house.

I felt inspired to write a letter to the home buyer I was four years ago, when I purchased my first single-family home with no small amount of dread and foreboding.

Rowley offers opinions and advice on a wide range of subjects. She would tell her younger self that:

  • The real estate agent works for you; don’t be afraid to ask questions.
  • Examine the bones of the house and base your buying decision on that, not on the easy-to-change superficial features
  • Don’t buy a “starter home” — buy a house that you could live in for a long time. You can never be sure what’s going to happen, and you may be stuck in a house longer than you’d planned.
  • Don’t make major renovations until you’ve lived in a house for at least a year. This time will give you a chance to learn what really needs to be changed.
  • When you do renovate, get the advice of an architect. It will cost a little more, but you’ll get a better plan.
  • Hire professionals to make the needed cosmetic changes — painting the walls, refinishing the floors — all at once before you move in.
  • Save your renovation receipts for tax purposes.
  • Take a fifteen-year mortgage if possible. Squeeze blood from a stone to make it happen.
  • For one year (not the first year), track every expense you make on the house. This will help you budget for the future.
  • Don’t tear out all the quirky things right away. In time you will learn if these quirky changes serve a function.

I think much of Rowley’s advice is great; however, I disagree with some of what she says. Many homeowners are perfectly capable of refinishing their own floors. (We hired somebody to do it, but if we were buying this house now, we would do it ourselves.) Anyone can paint, and quickly. Just do it before you move in.

If I were writing to my younger self, I would offers these additional tips:

  • A little elbow grease and a very little cash can change the entire feel of a house. We lived in our first house for ten years, and parts of it felt oppressive. When we prepared to sell the house, some new paint in a few rooms, and a few cheap new light fixtures made a HUGE difference to the feel of the house. Why did we wait so long?
  • You’ll spend most of your time in just a few rooms. A house with more rooms isn’t necessarily better. Buy what you need.
  • A good mortgage broker is worth his (or her) weight in gold — he can help you find the best interest rates. Ask your friends, family, and co-workers for recommendations. Somebody will know a good mortgage broker.
  • Do cosmetic work before you move in. It’s too easy to move into a place telling yourself that you’ll get to painting the walls “eventually”. Pretty soon “eventually” has become ten years! Do the easy stuff before you move in.

In particular, I would stress doing whatever possible to reduce the total money paid to mortgage and interest. Your mortgage will be the biggest expense of your life. Do what you can to cut the cost. Make a bigger down payment. Do whatever you can to reduce the interest rate: pay points, take a shorter term, shop around. Use a fifteen-year mortgage, or a ten-year mortgage. Make an extra payment every year. Every little change you make to financing now will pay huge dividends over the long haul.