Clueless About Buying Your First Home?
Renters love the little to no maintenance of a rental home and the ease of packing and moving at the drop of a hat. But with rent prices increasing everyday and fewer and fewer nice properties available for rent many renters are caught in a tight spot. Landlords know their poorly designed units will be snapped up by hungry renters and will be more and more unwilling to spend any money to fix or update anything. This leaves renters paying higher and higher to rent an older and often rundown property.
If they decide to buy a property of their own they have a myriad of decisions to make. I have seen more than a few times people buy a property; have it customized to their liking only to see it back on the market a year later. Buying and selling real estate in expensive and the closing costs can add up really fast. If you have been saving up to buy a place of your own here is a list to consider before you sign on the dotted line.
10 Things to Consider Before you Invest in Your First Home.
1. Is your daily commute practical? Is your daily commute from the new location something you can live with for a long time? Is it likely to change if you look for another job?
2. Will you be having kids soon? Plan for an extra bedroom more some storage space. If a new addition to the family is in the near future then how safe is the town you want to buy in? Does it have good day-care. How are the schools?
3. How much time do you want to invest in the upkeep of your new home? Some people love to spend the weekend doing yard work and fix-ups around the house. If you don’t want to spend the summer weekend lawn moving or spend money on a lawn maintenance company then perhaps a condo or a townhouse may be the right choice for you.
4. Will the new Mom-to-be be returning to work soon? Will that commute be reasonable with a small child?
5. Will you be Moving Closer to Family? Having a close family member nearby is always better in situations when both parents commute to work. Aging parents also need someone close they can count on.
6. Is your mortgage payment reasonable? Use a mortgage calculator to see what your monthly payment will be. If you have to scramble to make ends meet it puts a lot of stress on the new owners and even a small salary reduction can prove to be a major hurdle. A 30-year mortgage is a long commitment; make sure you plan for yearly vacations and other unforeseen expenses so you have enough to enjoy your life. Don’t forget to include property taxes, home owners insurance and HOA fees if any.
7. New Construction or a Pre-owned home? The look and feel of a newly constructed home is definitely a major draw for most people. It has the modern look, you can choose your finishing and upgrades, and you don’t have to worry about unexpected repairs. The builders often have a 10 yr builder’s warranty to cover unexpected issues that come up. If it fits your budget; that is the best way to go. If not there are older homes that have been updated and well maintained that may be a better option. The major concerns in an older home are the foundation, the roof, the furnace, AC and windows. A home inspection usually covers much more than these basic things and your realtor will be happy to recommend a good company for you.
8. How Technology friendly and Eco-Friendly is your home? If you need fiber optic speed then make sure you are scouting neighborhoods that have been wired for it. If you want an Eco-friendly home find out which homes have solar panels, energy-efficient systems, insulated attics, metal roofing, insulated doors and windows. Not all homes have all these features. In fact only 10% of homes might have 1 of these features. You might be looking for a needle-in-a-haystack but if you never know.
9. What is Title insurance? One of the requirements of purchasing a property is clear title. A title search and insurance is ordered prior to closing, usually by your attorney, to make sure all prior liens are paid off and you now own the property free and clear. This is an important step and most mortgage companies will not lend you money without clear title.
10. What are your Closing Costs? They are all costs associated with buying and selling real estate, including home inspection, mortgage costs, attorney fees, real estate commissions, recording fees, HOA dues, title work, and property taxes. These can range from 1-2% of the purchase price.
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