First-Time Home Buyer’s Guide: Navigating Spokane Real Estate Like a Pro

If you’re thinking about buying your first home in Spokane, this guide will help you navigate the process smoothly. Buying a home can feel overwhelming—especially if it’s your first time or if you’re getting advice from friends and family who bought homes years ago. Today, we’ll provide a roadmap for the entire process, highlighting important steps and tips specific to Spokane. Let’s get started!

Step 1: Know Your Budget

Before you even start looking at homes, it’s essential to understand what you can afford. Spokane’s housing market varies widely depending on the neighborhood, so getting clear on your financial situation will help you make informed decisions.

To get started:

• Meet with a lender or mortgage broker to get pre-approved. This doesn’t commit you to buying right away but gives you a clear picture of your budget.
• Down Payment Options: Contrary to popular belief, you don’t always need 20% down! Many first-time buyers can qualify with as little as 3-5% down, and veterans may be eligible for 0% down.

Step 2: Consider Your Down Payment and Savings Strategy

Saving for a down payment can feel like a big hurdle, but there are options to make it more manageable:

• FHA or VA Loans: If you’re a first-time buyer or a veteran, these loans allow lower down payments.
• Set Up a High-Interest Savings Account: If your future mortgage is estimated to be $2,500 but you’re currently paying $1,800 in rent, try saving the $700 difference. This can help build your down payment while preparing you for the increased monthly expense.

Step 3: Choose Your Neighborhood Wisely

Spokane has a variety of neighborhoods, each with its own unique appeal. Here are a few options:

• South Hill: Known for its charming older homes and established feel.
• Spokane Valley: Often more affordable with a suburban vibe.
• Mead and Liberty Lake: Higher price points but great schools and amenities.

Step 4: Pay Attention to Spokane’s Market Trends

Understanding the Spokane real estate market will give you an edge. One key metric is month’s supply of inventory:

• Spokane Average: About 3.3 months, which means homes are selling relatively quickly, especially in popular areas.
• Higher Inventory Areas: Areas like Deer Park or Newport have closer to 5-6 months of inventory, offering buyers more negotiating power and a bit more time to decide.

Step 5: Decide Between Fixed and Variable Mortgages

Choosing the right mortgage is an important decision:

• Fixed Rate: Offers stability with a consistent monthly payment.
• Variable Rate: Typically lower initially but fluctuates with the market. This could be a cost-saving choice if you anticipate interest rates dropping in the future.

Remember, refinancing can come with costs, so weigh those potential expenses before jumping into a variable rate with plans to refinance later.

Step 6: Making an Offer

When you find the right home, it’s time to make an offer. Spokane’s market can be competitive, so consider these elements:

• Price: Work with your agent to analyze comparable sales and determine a competitive offer.
• Earnest Money: Typically 1-2% of the purchase price, this deposit shows the seller you’re serious.
• Closing Date: Expect around 30-45 days to close on a home, though this can vary.
• Conditions/Contingencies: Be prepared to negotiate aspects like financing, inspection, and appraisal.

A helpful tip is the Out of 10 Rule: When viewing a home, rate it out of 10—but no sevens allowed! If it’s a six or below, move on. If it’s an eight or higher, seriously consider making an offer.

Step 7: Don’t Forget Closing Costs

In addition to your down payment, closing costs typically range from 2-5% of the purchase price. These can include:

• Title Insurance, Homeowner’s Insurance, Appraisal and Inspection Fees
• HOA Fees (if applicable)
• Property Taxes adjustments.

With recent changes, some buyers may also need to pay their realtor’s commission, especially in multiple-offer situations. Be sure to discuss these details upfront with your agent.

Buying your first home in Spokane doesn’t have to be overwhelming. By understanding your budget, getting pre-approved, choosing the right neighborhood, and working closely with a knowledgeable agent, you can navigate the process with confidence. If you’re interested in diving deeper into the home-buying journey, we’ve created an entire buyer’s guidebook with detailed steps and tips!

Ready to Start Your Home Buying Journey?

If you’d like help finding the perfect home in Spokane, let’s connect! Reach out for a digital copy of our buyer presentation book. Whether you’re buying your first home or simply exploring options, I’d love to be your real estate resource.