6 Tips for Solo First-Time Homebuyers, According To Experts

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Buying a home is expensive for anyone — but it’s even more out of reach for singles, according to finance expert Sofia Vyshnevska, co-founder of NewHomesMate. On average, solo earners spend nearly $5,500 more annually on housing than their dual-earner counterparts. And, if you’re the sole person responsible for other expenses — food, clothing, gas and entertainment — those housing costs can take a huge chunk of your budget.

So what if you’re ready to step away from rentals and buy your first home? It’s doable, but you’ll need to come up with the down payment and qualify for a mortgage based solely on your own finances. Vyshnevska recommends taking six steps to optimize savings and realize the dream of homeownership if you’re single.

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1. Pay Off Your Debts First

If you have any high-interest credit cards or loans, work on paying them off before you start saving toward a down payment. That way, less of your hard-earned income goes toward interest over time, and you won’t need to deal with pesky credit card bills when you take on a new mortgage. 

For instance, say you have a few credit cards with a total $5,000 balance. Your interest rate is around 25%, and you’re making minimum monthly payments. At the same time, you’re trying to bolster your savings by diligently stockpiling $100 of every paycheck.

Here’s the kicker: You’re actually losing money. Even if you have a high-yield savings account, the interest earned is far less than what you’re incurring on your outstanding debts. Vyshnevska advises singles to find a way to refinance debts (try a 0% APR introductory offer on a credit card) and pay them off. Then start working on your savings.

2. Set a Realistic Budget and Stick To It

Budgeting is a basic tenet of personal finance. But knowing how to create a budget — and stick with it — are two different things. It’s very easy to overspend if you’re not careful, blowing any funds you hoped to put toward debts or savings.

Vyshnevska recommends creating a reasonable budget that isn’t overly restrictive and comparing your spending patterns weekly or monthly. If you overspend, figure out why and look for ways to prevent it from happening again. Remember that your goal is the keys to a new home.

3. Make Savings an Automatic

It’s a familiar feeling. You plan to set aside $200 from your paycheck into savings, but the week goes by and your bank balance is close to $0. So much for savings — you’ll try again next week.

If you just can’t seem to put your money aside, try setting up an automatic transfer from your checking account. Most banks offer the feature free of charge, eliminating the need for any manual intervention on your part. 

4. Look For a Low-Maintenance, New Construction Property

Yes, buying an older home may mean a cheaper price tag. That’s especially true for properties in need of significant repairs. But getting an older property into tip-top shape can mean significant costs, and there’s no way to guarantee what the final repair bill will be. 

Instead of going that route, Vyshnevska recommends looking for a new construction home with modern, energy-efficient materials and appliances. A new property may come with a few financial incentives like special mortgage rates and closing cost credits — that means less work and more affordability over the long run.

5. Utilize First-Time Buyer Programs

Some state and local governments recognize how difficult it is for new buyers to get their first home. They’re making things easier with grants, tax incentives and lower-interest mortgages. Check your state’s resources for available programs to see if there are any you may qualify for. 

Vyshnevska notes that most state and local government programs receive limited funding that runs out quickly. So, apply early to boost your chances of acceptance.

6. Enjoy Your Single Lifestyle

Being single comes with a lot of flexibility. You don’t need to make concessions to your partner and you’re free to buy whatever property you want. Vyshnevska says to take advantage of the freedom and don’t be afraid to purchase a smaller property or explore up-and-coming neighborhoods. Simply getting your foot in the door of homeownership is the goal. As your property builds value and equity, you can move up the next rung on the property ladder. 

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