As a young home buyer, it can be exciting to take on the challenge of customizing a new place to call your own. While you may feel overwhelmed with all the potential choices, there are a few key financial tips that you should consider to help make sure you have a successful experience. From budgeting wisely and negotiating the best price to understanding your resources and seeking professional help, here are four financial tips to keep in mind if you’re considering customizing your new home.

Financial Tips Young Home Buyers Should Consider:

1. Knowing your budget

As with many large purchases in life, you’ll need to have a solid understanding of how much you can afford to spend on a house and what the ongoing costs of that purchase will be. With the purchase of a home that you intend to customize, you’ll have to keep in mind what the initial price tag of a home will be, and factor in the costs of any repairs or unexpected costs that can come up when getting into the ‘guts’ of a house during renovations.

Take stock of all your current expenses, savings, and income to put together a budget with realistic numbers. It’s tempting to cut back extensively when you have a big goal but remember that whatever financial decisions you make will need to be sustainable far beyond the date you close on your dream home. You’ll still be paying on a mortgage that might fluctuate depending on the type of loan you apply for that your lender approves. Having a realistic budget not only keeps your spending in check but also helps show lenders that you can pay back a loan responsibly. Build space for contingencies to allow breathing room as well when costs of materials or labor start to pile up.

2. Researching prospective contractors

It’s tempting to go with the first contractor who seems reputable and affordable, but unless this person has come with high recommendations from other people you trust, it’s important to do your homework.

Contractors can make or break your project and have the power to make the entire process miserable, or smooth and enjoyable. When getting quotes from potential contractors or companies, have a solid list of what you need or want to be done in your new home and gather

not only how much money but also the time each contractor projects they will need to complete the job. Beware of very cheap prices with short completion estimates and ask for their credentials on licensing and insurance coverage they carry, as well as referrals and when you can expect to see them and their crew working on site.

Many will have pictures of projects and customizations they have done for past clients for you to review, and it is perfectly acceptable to ask whether you can contact those people to hear about their experience. Look for online reviews via Houzz, Google, or Angie to read more reviews, making sure to pay attention to the date. If your home is a new build and there are already people living in their custom-built residence from the same contractor, see if it is possible to meet with them and ask what they think of the quality and longevity of each feature. This will help inform your decision on what you’d like to have in your own home.

3. Investing in energy efficiency upgrades

With high energy prices continuing to rise in the United States, many home-buyers and owners are looking to find homes that already have energy-saving features, or to add them to their pre-existing homes.

Talk to your builder or contractor about the materials that will be used to build your home and the unique features each has that can help keep your home efficient. While keeping your budget in mind, weigh the pros and cons of spending more on features like upgraded windows or solar panels that can ultimately add more to your monthly payment while saving money on your energy bills.

Many of these energy-saving customizations will cost more up-front but save money in the long run, and any feature you add can also attract more buyers if you decide to sell your home in the future. Take time to decide what matters the most to you, and what features are easier to install now, or can be added on later when time or money allows.

4. Being aware of potential hidden costs

Construction, remodeling, and customization all have the potential to come with hidden and unexpected costs. Some costs, such as building permits and inspections, may come as no surprise, but other expenses you might encounter on your bill could include demolition and cleanup costs, design services, and contractor fees that were not discussed initially.

To avoid these items surprising you, ask for itemized lists of everything your contractor will do, and current material costs. Ask from the beginning what costs come up unexpectedly on a regular basis, and how much each customization could run prices up as you decide on what to add now, vs. later.

Certain changes to a home can also increase not only the value of your home, but also your property taxes and insurance costs. Compare your home’s value plus the changes you want to make to other homes in your area that have similar custom elements. Then, decide whether

these improvements are a priority for you. If so, revisiting your budget might be necessary to reorganize the list of customizations you want to be made.


By setting a budget and obtaining multiple quotes from contractors, you’ll be able to get a firm roadmap for customizing your home and making sure you know what to expect. Whether you’re building a new home or adding energy-efficient customizations, make sure you prioritize the changes that mean the most to you and fit into your budget in the best way possible. By keeping an eye out for hidden costs, you’ll be able to make the best financial decisions in your custom home and create a home you can have peace of mind living in for years to come!

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