9 Things to Consider When Buying a Home
1. Stay a While
If you don’t want to stay in your home for an extended period of time, you may not be ready for home ownership. If you can’t commit to a long term relationship with the house that includes maintenance, repairs, and improvements re-evaluate your motivation for buying a home.
2. Get to Know the Neighborhood
Schools, access to public transportation, proximity to restaurants, and traffic noise effect the resell value of the home and quality of life. If you are near a fire station or train tracks, know that there will be a lot of noise and consider whether or not that is a deal breaker for you.
3. Get a Home Inspection
No house is perfect, especially if you are looking at an older house with good bones. If the inspector finds issues with the house, you may be able to negotiate the price down. Also, don’t be afraid to ask probing questions about the maintenance history. If you find out that the basement flooded five years ago, the house may be vulnerable to flooding. Furnish the basement appropriately knowing that you may need to be able to move furniture on short notice.
4. Credit Score
Be aware of your credit score and how it will effect the interest rate of your mortgage. Make sure all of the information is correct so that you get a fair rate. There is nothing worse than finding out there was an error in your credit score that adversely effected your interest rate.
5. Don’t Buy More Than You Can Afford
Get preapproved so that you only look at homes that are in your price range. Use a mortgage calculator to find out what you can really afford. Don’t look to buy a house that is too big or has more than you need. Even if you are thinking about starting a family after you buy your next home think about how you can use the space efficiently. Do you really need that extra room and the steam room? You don’t want to end up paying too much in utilities for spaces that you do not use.
6. Hire Professionals
You’re an amateur. Don’t take it personally, but you need a professional realtor to take the lead in this process. As the full time liaison between the buyer and the seller, the real estate agent will be able to connect you with homes that meet your criteria. As the liason the realtor also serve as a negotiator who can express your concerns and act in your best interest without bad blood between the buyer and the seller.
7. Fixer Uppers are Not Easy
Don’t plan for renovations to stay within budget or be on time. Be realistic about what you can do and how long it will take. It may take a few years before you can afford to finish the basement and that is ok.
8. Research Everything
Find out what houses in the neighborhood are selling for. Is it trending up or down? Your bid will be based off of these trends. Is there a microblog that covers the neighborhood? Read it everyday to see what is happening in your town. If possible, talk to neighbors to get a feel for the neighborhood and any issues that may arise. Is there a neighborhood association? Get your hands on a newsletter to learn about the area. If possible find out what work has been done on the house in the last few years. When was the last time it was repainted? Did they have the roof replaced? How much did it cost?
9. Think Long Term
Customize the house to your liking but be aware that it may take longer than you would like. Think about the lifestyle you want to have in five or ten years and how you can add value to your house while enhancing your current lifestyle. Is there enough space in the backyard for that pool that you have always wanted? Keep an eye out for opportunities to maximize the value you can add to your home.