Your first home: What all buyers need to know in 2026

By preparing well beforehand, you can take advantage of this and be a step closer to getting approved for your first home financing application and becoming a homeowner.

What Are the Three Types of Homes? 

The three primary types of homes in the U.S. include:

• Single-family detached homes
• Townhouses
• Condominiums

Of these three home types, single-family detached is the most common. According to a September 2025 report published by the U.S. Census Bureau, of the more than 146.74 million housing units in the country (as of 2024), over 89.64 million are single-unit detached homes.

Knowing your home type options is crucial, as it can help ensure your choice is affordable and matches your lifestyle, preferences, and needs.

It can also keep your homeownership expenses manageable. It can, for instance, help you avoid hidden fees like excessive maintenance costs in older homes or HOA fees in condos.

What Is a Good Age to Get Your First Home? 

A traditional real estate for beginners strategy is to buy your first home as early as possible (e.g., your late 20s or early 30s), as this gives you more time to build equity. Today, however, the "youngest" buyers aren't that young anymore, with many first-timers pushing 40, per NBC News.

While buying as early as you can remains a smart move, financial readiness is more crucial than chronological age, given today's market conditions. Being financially ready means having:

• A stable income
• A good or excellent credit score
• Enough savings for a down payment

What Are the Essential Steps to Buying Your First Home? 

Due to affordability concerns and market challenges, buying your first home requires more thorough preparation that involves your budget, creditworthiness, and savings. Focus on these before you even start your search for your future "forever" home.

Setting a Realistic Budget 

Establishing a realistic budget means assessing your actual financial capacity to determine how much you can afford when buying your first home. Consider the following factors to figure out a comfortable and sustainable total purchase price and monthly payments:

• Income
• Debts
• Savings

Ideally, your long-term housing costs should be under 30% of your gross monthly income. According to Investopedia, exceeding this can result in significant financial strain.

Determining Your Creditworthiness

Creditworthiness is a term used by lenders to assess your ability to pay back what you owe. They determine this by analyzing several factors, including your:

• Credit score
• Credit report
• Income

The more creditworthy lenders perceive you to be, the more willing they'll be to lend you money, and the better their loan term offers will likely be. Checking your creditworthiness should therefore be on your first-time home buyer checklist of priorities.

Saving as Much as You Can for a Down Payment

Saving for and making at least a 20% down payment used to be the standard, even requirement, for buying a home under a financing (mortgage) program. It's no longer mandatory in many cases, but you should still aim for this because it:

• Eliminates the need for private mortgage insurance (PMI)
• Reduces the amount you need to borrow
• Can help lower your monthly mortgage payments
• Minimizes the overall cost of your mortgage

Partnering With the Right Mortgage Professionals 

Partnering with the right mortgage experts can benefit you, particularly as a first-time buyer, as they'll help you navigate the complex financing process. They will, for instance, assist you in choosing the best loan for your short- and long-term investment goals, as noted by Landmark Mortgage Planners.

Reputable mortgage professionals will also provide you with invaluable guidance regarding the loan options available to you. Depending on your needs and circumstances, the types of mortgages you may qualify for include:

• Conventional loan
• FHA loan (mortgage insured by the Federal Housing Administration)
• VA loan (mortgage guaranteed by the U.S Department of Veterans Affairs)

Frequently Asked Questions

What Affects Your Creditworthiness When Buying Your First Home? 

Your payment history is among the most significant factors affecting your creditworthiness, notably your credit score.

Lenders prefer borrowers with a history of paying their financial obligations on time. Conversely, they're wary of borrowers with frequent late or missed payments on utilities, credit cards, and loans.

Lenders also consider your credit utilization rate (CUR) or the amounts you owe. If you have high balances (e.g., you've used up 90% of your credit limit), they may perceive you as a high-risk borrower.

According to CNBC, the general rule of thumb is to ensure you don't let your CUR exceed 30%, but to achieve an excellent credit score, you need to keep it at 10% or less.

Should You Work With a Real Estate Agent When Purchasing Your First Home? 

You're not under any legal obligation to hire a real estate agent when buying your first (or succeeding) home.

You should consider doing so, though, as a buyer's agent can give you expert guidance with their local market knowledge. They may even be able to save you money with their expert negotiation skills and fiduciary protection.

Having a buyer's agent, for instance, can help you manage home inspections and warn you about properties with the potential to become money pits.

Time to Prepare for Your First Home 

Understanding house types, establishing a realistic budget, and ensuring you're creditworthy are all critical steps to buying your first home. Just as crucial is to save as much as you can for a down payment and partner with the right mortgage and real estate professionals.

By following these tips, you can make your first-home buying experience smoother, less stressful, and more affordable.

Find the latest in real estate news and more insightful home-buying guides by exploring the rest of our platform.

This article was prepared by an independent contributor and helps us continue to deliver quality news and information.