As you begin to save up your down payment and you have close to the right amount you will naturally wonder when to start looking for a house. Here is a good guideline for how early to start looking for a house and the steps you should take leading up to that time.
When Should I Start Looking For Houses?
The best time to start looking for houses is about 5 months before you actually want to move in. This gives you enough to time to get things in order, look for a house and move in without feeling rushed.
How much time will it take to buy a home?
Assuming you have done no prior research on your house you will need to get things in order before you get started. This is the average timeline for a new home buyer.
If you are renting a place and your lease is coming due in the next 5-6 months. That is an ideal time to start looking. It will give you enough time to look for places. Find a few that meet your search criteria. Make a couple of offers, and ultimately get one accepted.
Things can always move faster but if you are tied up in another place, getting the home buying ball moving sooner than later is better than leaving it until it’s too late. The last thing you want to do is be rushing into a quick purchase.
Millennial Homeowner Tip on How Early to Start Looking at Houses
To find out how early you should be looking at houses, the best thing to do is work backwards. The last thing that you do to put things in motion will be to put in an offer on a house. This will take between 24 to 72 hours (depending on the terms you set out in the offer), so let’s say 3 days.
Possession on the house is usually around a month to a month and a half. Sometimes you will get a long possession date, meaning you won’t get into the house for a long time (anywhere from 3 months or longer).
Then you will need to find a mortgage broker, real estate agent, lawyer and home inspector. As well as get all of your finances in order. Which can take a month or two depending on how busy you are.
So to keep the stress down (because trust me, when you are looking at a house it can spike up) giving yourselves 5 months before you need to be somewhere else is a great plan.
You can speed this timeline up (or slow it down) but to not feel too rushed you should give yourself this extra time to do everything that is need with enough due diligence to feel comfortable.
Month 1 (5 months out)
Start to look at open houses in areas you like and see what the prices on the houses are. This is also a good time to start informally interviewing real estate agents. They will be showing the houses you view and you can chat with them and see if they are good fit. See our article how to find a good realtor here.
Month 2 (4 months out)
While you are looking at houses you will want to get your mortgage affairs in order. This will means getting approved for a mortgage (to find out the difference between pre-qualified and pre-approved mortgages see this). You can do this with an online mortgage broker such as Lending Tree.
All the time you are going out and checking out places to get a feel for different neighborhoods and home prices.
Month 3 (3 months out)
Around now you can interview your real estate agents and pick one that is a good fit. At this point in your timeline for buying a house your agent will get you to sign a contract and they will set up a search on their MLS system. This way you will get emails when new homes get listed that meet your criteria.
Month 4 (2 months out)
This month will be more looking at homes (use this home inspectors checklist to make sure a house makes the cut on putting in an offer). The average person will look at 8 homes before making an offer. Sometimes it’s more, other times less, but this is a good ballpark to aim for and if you are finding yourself looking at more it’s ok. You may need to tweak your search criteria or make some changes. Once you put in a offer you will be setting a possession date.
Normally a possession date on a house is around 4-6 weeks. This means that if you were to find a house today and put in an offer you could be sitting in it a month from now. Some possession dates are quicker, but that’s usually how long it takes to get into the place you are looking at.
Sometimes the listing will have a date in mind (the seller will likely be moving and will want the date around a certain time that works for them. You can make it a different date, but it may end up costing you a little more due to the inconvenience of the seller.
Month 5 (1 month out)
While you are waiting for possession the mortgage company or bank will want other information. You will also book the home inspection and touch base with you lawyer.
While all this is going on you will need to start packing and getting things ready for you big move. If you are needing things make sure to use a home essentials checklist to ensure you have everything for your new place.
End Of Month 5
This is your possession date and when you go to the lawyers to get the keys and close on the house. It’s exciting! Make sure you have these moving day essentials.
Final Thoughts on When to start looking for a house
While this timeline can change from person to person, giving yourself 5 months to get things ready and in order will ensure you are taking enough time and doing your due diligence on all things related to buying your first home. This is the biggest purchase of your life and you want to make sure you are taking the right steps to buying a house.