Springfield, Missouri is a first-time home buyers paradise.
From its great neighborhoods filled with affordable homes to its bustling city center, and great local schools, Springfield is the perfect place to begin your journey on the property ladder!
However, buying your first home can be a daunting and challenging task, especially if you do not know anything about the process.
To help you out, we have put together this comprehensive first-time home buyer’s guide to Springfield, MO to ensure you are equipped with everything you need to help you find your dream home.
Our years of experience and knowledge of the local area have been poured into this guide, so you can rest assured that we will be providing you with all the tips and tricks you need for home-buying success in Springfield.
Let’s get into it!
Whether you’re a first-time buyer or a seasoned house purchaser, there are several financial steps you always need to take before purchasing a house to make sure you are ready to enter into a sale.
Here are the key considerations you need to factor in before you purchase a house to ensure that you are financially ready.
It is important that you understand the difference between pre-approval and pre-qualification.
If you’re about to purchase a house for the first time, there is a high chance you have heard that you need to either be pre-approved or pre-qualified before you can get the ball rolling on a sale.
However, the two terms have entirely different meanings, which can catch some people out as they often use them interchangeably.
Pre-qualification is technically the first financial step you need to take.
It typically involves sending your bank or mortgage a snapshot of your general financial situation. This is where you disclose things like debts, assets, and annual income.
It is a very quick process and allows the bank to get a good idea of your financial standing so that they can help you come up with a plan that results in home ownership.
If you meet all of their requirements, you will be issued with a pre-qualification letter.
Pre-approval is the step that comes after pre-qualification. It is a concrete decision from your bank that shows you can obtain a loan for a house.
This requires you to go through a very specific process in which your finances will be analyzed for potential risk before the bank hopefully issues you a pre-approval letter that will allow you to take out a mortgage to purchase your house.
At the end of the pre-approval process, your bank will approve you to borrow and spend up to a certain amount, which gives you some sort of budget for your first home purchase.
Another financial consideration that must be considered when you are financially prepared to buy your first home is your credit score.
When applying for a mortgage, your credit score is one of the key credentials the lender will look at when deciding whether or not to issue you a loan.
The weaker your credit score, the less likely that you will be allowed to borrow.
Additionally, the higher your credit score is, the lower the interest rates on the loan you take out will be.
The lower the interest rate the better, as this cuts down on the amount of time and money you will spend paying back your mortgage.
As a general rule of thumb, you need a credit score of at least 620 to be able to qualify for a home loan.
If your credit score is below this, it is a good idea to try to bump it up before attempting to purchase a house.
You can increase your credit score by reviewing your credit reports and making changes where needed.
This could be getting on top of your bill payments, consolidating your debt, or using 30% or less of the credit available to you.
While you are typically never required to front the entire purchase of a house using your own money at the time of the sale (thanks to mortgages,) you will need to come up with a down payment, as banks will not loan you the entire amount.
The down payment is often the aspect of homeownership that acts as a barrier to a lot of would-be buyers, as you need a significant chunk in order to be able to obtain a loan and purchase a house.
Luckily, there are many options out there to help you save towards your down payment goal.
Being frugal and cutting out unnecessary spending when saving for a down payment is a great way to save some extra cash - you would be surprised at how quickly it all adds up.
Additionally, keeping your money in a high-return savings account is another fantastic way to maximize your down payment and help you to reach your savings goal as quickly as possible.
Springfield also has a special program for first-time buyers in the area to help them save for a down payment. You can find out whether you qualify and all the necessary details here.
Many people forget that the finances for purchasing a home do not stop at the down payment and mortgage.
There are several other payments and costs you need to adequately budget for before purchasing a home to ensure you are financially ready to take on the responsibility of homeownership.
Payments such as property taxes and insurance often slip people’s minds when buying a house, only to creep up on them after the sale.
Make sure you have considered whether you can afford these costs in the long term before purchasing a home.
Additionally, many people do not factor in potential repairs before buying a home.
It is a good idea to thoroughly check through the house you wish to buy and identify any potential repairs that will need attention in the near future.
Then, you need to consider whether you can afford these repairs.
Repairs can be a nasty and costly surprise that catches many first-time home buyers off guard, so you must take adequate steps to ensure you are in the best financial position possible.
Once you have financially prepared for your home purchase, it is time to find your team that will help you find your dream home.
Here is an outline of everyone you need to consider in order to give you the best chance of finding a perfect home in Springfield.
One of the best ways to ensure you find the best house possible is by using a real estate agent.
However, you should specifically employ a local real estate agent, especially if you are new to Springfield.
This is because the market in each city is very different, and a real estate agent’s job is to keep up with the trends and know everything there is to know about purchasing in the area.
A real estate agent will listen to your preferences, as well as your budget, and use their extensive network and knowledge to find potential houses in Springfield that fit all your criteria.
They can also be very useful when it comes time to negotiate a purchase price, as they know how to best approach the situation to ensure the best outcome for all.
Another key part of your house-buying team is your mortgage lender. This is the entity that will lend you the money to purchase your house, and who you will slowly pay the loan back to over the next few decades.
Many people assume that mortgage lenders are simply banks, however, there are several different types.
Banks are the most commonly used type of mortgage lender, as most people have an existing relationship with a bank, and they have strong lending structures in place that simplify the process.
However, you can also obtain a mortgage from a credit union, which is not run for profit, or an independent mortgage broker which deals purely in issuing home loans.
Additionally, there are different types of mortgages that you should be aware of. An FHA loan is backed by the Federal Housing Administration and is designed for moderate to lower-income earners who have accrued some debt.
They typically require a very small down payment, however there is a limit on how much you can borrow.
On the other hand, there is a conventional mortgage, which is a loan that is not backed by the government.
Conventional loans allow for much larger borrowing amounts and can be used on a primary or secondary residence. However, you need a much higher credit score to qualify for this type of loan.
Alongside your real estate agent and mortgage lender, you may also want to consider adding a few more members to your house-buying team.
Hiring the services of a home inspector is a great way to ensure that you are making a wise purchase. A home inspector’s job is to meticulously inspect your potential home and look for any potential defects or issues that have not been disclosed by the real estate agent or sellers. This allows you to learn of any potential repairs or issues that you may face in the future, allowing you to make a more informed decision as to whether this home is the right purchase for you.
Additionally, using an appraiser when purchasing a home is a fantastic idea. An appraiser has extensive knowledge of the housing market and can give you an objective and unbiased idea of how much the home is worth. They will be able to indicate whether the asking price of the house is too high and give you an idea of whether you are paying the right amount for your first home.
If you’re purchasing a home in Springfield, it is wise that you do some research on the local market to help ensure you make the right decision when buying a house.
Here is everything you need to know about the Springfield market right now, including trends, best areas, and which type of home is the best purchase.
The housing market in Springfield, MO is currently very hot, with 2024 prices up 5.3% from last year.
The current median house price is around $230,000 according to local statistics, with projections that this will increase in the coming year.
Trends are showing that the market is currently very balanced, which means there is an even supply of homes being sold compared to the number of people looking to buy in the area.
At the moment, homes are spending an average of 29 days on the market, which means that listings are getting snapped up fairly quickly.
The top neighborhoods that buyers are looking at are West Central, Grant Beach, and West Side due to their affordability and proximity to amenities.
Not all neighborhoods are built the same, and as a first-time buyer, you are looking for something that is affordable and practical, rather than a big show-stopping home that will cost an arm and a leg.
There are several areas within Springfield that are ideal for first-time buyers as they offer affordable yet beautiful homes that are close to everything the city has to offer.
One of the best areas for first-time buyers is Oak Grove. Oak Grove is on the eastern side of the city and is situated near the city center and all its shops, restaurants, and museums.
The area is home to several good schools, making it a great choice for those who are planning to add to their family shortly, and there is also a lovely neighborhood park!
The homes here are very reasonably priced, with most sitting around the city-wide median of $230,00.
This is a great choice for any first-time buyer who is looking for a solid home in a good area.
Another area to consider is Rountree. Located right in the middle of the city, it is known as the city’s historic neighborhood and is filled with character buildings and homes.
The neighborhood is home to some of the city’s best restaurants and local shops, making it the ideal spot for social butterflies who like to get out on the weekends.
Its central location also means you are extremely close to all the key amenities you need, and it makes getting to work very easy.
Prices here are slightly higher than in other areas, however, that is because you will be purchasing a unique historic home.
If you’re looking for a long-term investment, then buying in Rountree might be the right idea for you.
Finally, the neighborhood of Brentwood is a good spot for first-time buyers. Situated in the southeast part of the city, Brentwood is home to many 70s-style bungalows that make for the perfect first home purchase.
The area is predominantly residential, meaning it is quiet and peaceful at all times.
However, it is still home to the Brentwood library, as well as several restaurants for those who are looking for a way to fill their spare time.
The neighborhood also borders the spectacular Long Pine Bike Park, making it the ideal choice for keen cyclists or those looking to pick up a new hobby.
Before entering the housing market, it is also a good idea to decide what type of home you are looking to buy.
This helps to narrow your search and will allow you to customize your preferences based on the type of home you are looking for.
Here are the most commonly found types of homes in Springfield.
A single-family home is typically a free-standing house with 3-4 bedrooms. This is the ideal style of home for a first-time buyer who is looking for a lot of space, especially if you have a family or want to have a family in the near future.
However, there are some drawbacks with this type of house, as they do require a lot of upkeep. Additionally, as there is a lot more space, they are typically much more expensive than other styles of homes.
A condo (short for condominium) is an individually owned unit within a community or block of other units.
A common type of condo is an apartment. In this sort of situation, owners own the interior of their unit, and everything else is owned by the corporation that owns the building.
This means that you don’t have to worry about exterior upkeep. Additionally, condos usually come with great amenities such as pools, gyms, and outdoor areas that residents get to enjoy without needing to maintain.
However, condos are typically quite small, so they might not be the best choice if you are looking for a lot of space.
A townhouse is typically a multi-floor, narrow home within proximity to the city center that shares walls with adjacent homes.
Townhouses have been a popular style of home for centuries, and you can find both historic versions and newly built townhouses in Springfield.
They are a great option for first-home buyers as they often offer more space than an apartment, but are typically not as expensive as a single-family home.
Additionally, they are usually located close to the CBD, making them a great choice for city workers. However, townhouses usually come with very little or no outdoor space, and they are significantly smaller than a regular home.
If space is a priority for you, then a townhouse may not be the best option for your first home purchase.
Once you have familiarized yourself with the local market, it is time for the exciting search and offer phase of your journey to home ownership.
While the process may seem daunting, there are several steps and measures you can put into place that make the process a lot easier.
Some say that the most difficult part of purchasing a house is finding a house to buy! In a market where thousands of homes are on offer, it can be difficult to know where to start.
One of our top tips is to harness the power of the internet and use the online tools on offer to your advantage.
The benefit of using an online catalog rather than a physical one is that you are able to apply filters to your search so that you can only see houses that are within your price range and have all the amenities and features that you are looking for.
This cuts down on time wasting and dead ends and helps to create a narrower pool from which you can finely comb through and find your dream home.
Another tip that many people seem to forget is to schedule your open home viewings effectively.
Attending open homes can be time-consuming, and no one wants to spend their precious weekend hours walking through house after house.
Many people try to schedule their open homes for one day and in quick succession, however, we advise against this.
If you view too many homes at once, you will start to struggle to differentiate between each one and remember what you did and didn’t like.
By effectively scheduling open homes, you will give yourself a chance to take your time with each viewing and make notes of the pros and cons of each home.
This will ultimately allow you to find your dream home with a lot more ease, and ensure that you become a homeowner in no time!
Making an offer on a home can be a scary task, especially if it is your first time.
However, the process does not need to be overly complicated provided that you have the right attitude and take the right approach.
Make sure you understand the role of contingencies when making an offer. Making a contingent offer means adding conditions to your offer that have to be fulfilled in order for the sale to go through.
For example, you might make an offer contingent on a positive builders report.
If the builder's report is not positive, the offer will not stand. This is a great way to protect your interests and ensure you are getting the best deal possible when making the purchase.
Additionally, you need to take the right approach if you want your offer to be successful.
Remember, in a competitive market such as Springfield’s, there is a high chance you aren’t the only buyer making an offer on a home.
Your offer must be competitive - you should not be lowballing the asking price as this is unlikely to result in a positive outcome. However, you should also be reasonable.
Don’t offer too much over the asking price, as otherwise, it will be difficult to make your money back when it comes time to re-sell the home.
If the seller is driving your offer up to an unreasonable amount, be prepared to walk away to ensure you don’t make a poor financial move.
After your offer has been accepted, the purchase process does not end. There are still several steps that need to be taken before the home is officially yours.
You will need to have the home inspected and appraised to ensure it is in proper condition and the price is fair, obtain homeowners insurance, transfer the title of the property, and allow the seller to fulfill any outstanding conditions.
On average, the closing process ranges from 30-60 days from the date of acceptance.
To give you an extra helping hand, here are some resources for first-home buyers in Springfield to equip you with everything you need to know.
Down Payment AssistanceYour first-time home purchase is a special process, and it should be something that you try to enjoy rather than something that adds stress to your life.
Here are some general tips to help ensure that your first time purchasing a home is simple and successful.
