One rule of thumb, if you have a home and considering an upgrade, get a REALTOR market appraisal on your home, and add minimum 25% to the budget. A first time home buyer has to approach shopping based on their experience and their budget, which often nearly maxxes out their available resources. Why is that? Generally most people who live in the same community generally have about the same income and resources, so there is competition.
For the first time home buyers, competing for a place to live and establish roots, there are many 'tricks' to finding a suitable home. If money limits your chances, look for other currencies you can bargain with. Often time is a great tool. A couple were living in their parent's basement, and since they had no boundaries in their current location, waiting for two to three months, for the sellers to shop for their new home was a successful compromise.
Money is not the only currency that works when bargaining for a new home. Often a thorough REALTOR will submit a cover letter with an offer to purchase, extolling the features and benefits this home will provide. The home might have a lovely garden, and a letter might indicate the buyer is a gardener. There may be a well built shop, that appeals to a tradesman, or maybe a fenced yard that appeals to pet owners or families. Appealing to the emotions of the seller has worked.
Buy a foreclosure. The process of buying a foreclosure property, and even an estate property can be daunting. Our family have bought multiple foreclosure properties with good success. However, ask your REALTOR what experience they have had with the successful process, because very few actually have. In BC, the process is not that difficult, but until you walk out of Forclosure Court, you have no idea if your offer has merit.
Buy an orphaned property. Some properties seem to perpetually be for sale. Often a seller will reject early offers because they believe their neighbor when told, "Your property is worth more than that!" Some homes are not appealing for a variety of reasons, usually cleanliness. In this case, be prepared to hire professionals who can inspect structure, electrical, water systems, land stability, and multiple other potential issues. Then be prepared to spend time cleaning, painting and repairing. Factor in all the costs before submitting an offer. Look beyond the lipstick to see if an orphaned property will meet your needs. It just takes a lot of elbow grease and hard work.
Creativity can help you nail the home that works for you, be resourceful and engage the services of a REALTOR with a hard-working reputation.