Congratulations! Now that you’re ready to buy your dream house, here are three factors that you need to consider before you take the plunge.
1.Budget. The first question should be – “Is it within your budget”? Suppose you do not have enough money to pay cash upfront. In that case, you should analyze if it will significantly affect your monthly expenses, and that includes bills, mortgages, and other household expenditures. Investing in a new home requires a big chunk of your budget.
Stretching a budget to buy a dream house is sometimes hard, but ensuring a steady cash flow is very important, especially when buying a home by a loan. It comes with interest and other charges. You can use online tools to help you check if there is a house on sale that fits your budget.
The most popular Real estate sites online, such as Realtor.com, Zillow, LoopNet, Trulia, etc., are always updated with houses for sale or rent put up by either the owner or broker. These sites can help you analyze your home’s worth if you want to sell in the future. Check these sites before making a decision.
If you are a first-time homebuyer, you can compare down payment options; you may apply online or through a mobile app and get offers from multiple lenders like Quicken Loans, better.com, Fairway, Money, Veterans United, and so much more.
2.Location and History. Where exactly do you want to live? Are you a farm guy, or you like the busy streets? Are you moving because of your job or because of your studies, or do you want to be closer to family? Is it your dream location to live in? There are tons of dream home locations you can find online but make sure to check if the area is safe for you and your family and decide on a peaceful and crime-free neighborhood. It will also give you peace of mind if you live in a location with quick access to a hospital, police station, school, church, etc.
This checklist will help you or your agent to find a new home that best fit your needs:
- Walkability – Do you prefer homes near the park, outdoors, public transport, mall, or grocery stores? Would you like to be close to family or friends? Do you like your new house to be close to the gym, resorts, pool, libraries, school, or restaurants?
- Street Status – Which street do you prefer? Is it side of the road, middle or end of the street? Do you prefer without any neighbor at all?
- Traffic – You may have a million-dollar view, but is it worth the 2 hours traffic jam you need to put up with before reaching work?
- Flooding or Tornadoes- Check the area if it’s prone to flooding or any natural calamities. Your goal is to live outside the high-risk flood zone or any location that is hit by tornadoes on a regular basis. This one major factor that you need to check upon. Some agents are not that open when it comes to disclosing information about the property’s history, especially if it might affect the house’s market value.
You can request for a C.L.U.E. report from the owner. “C.L.U.E.” stands for Comprehensive Loss Underwriting Exchange. It is a free report the owner can ask from Lexis Nexis. Lerner, Michele, author of “ C.L.U.E. Report – Why Home Buyers & Sellers Should Get One, “Money Crashers”, When you review the C.L.U.E. report of a home you’d like to buy, look for claims that indicate a potential ongoing problem, particularly claims that involve water damage. For example, if a home has had even one claim involving water, investigate the existence of mold or perhaps explore the need for flood insurance. If the pipes have frozen more than once, the home may need additional insulation.
Other potential red flags include multiple claims of any sort, such as more than one fire or more than one burglary. While these types of problems could indicate carelessness on the owners’ part, they could also mean that the home has a faulty electrical system or is located in an undesirable area.
In particular, review the C.L.U.E. report for claims related to: Water damage from a pipe burst, a flooded basement, Storm damage, Damage from an electrical fire, multiple fires, and numerous thefts.” These can help you decide whether you will give it a go or not.
3. Age and Size of the House. When it comes to house, age is not just a number. It means pest infestation or shaky foundation. If you’re a fan of vintage or gothic types, you may also want to reconsider the renovation possibilities it entails. Modern-day utilities and technology may not be well suited for such structure, and upgrading may be quite expensive. Some also believe in the paranormal activities present in an ancient house. Agents may not tell you these, so go ask the neighborhood!
Teardowns. Is a teardown home a viable option for you? See if new neighbors will not create any drama during the noisy construction and might as well go over with the utility companies if they can re-install or install right on time when you do the upgrades. You might be doing a lot more upgrades than you imagine and spending more instead of saving more.
It is better to invest in a newer property. It is less work and lower initial investments. When assessing the house’s size, you want to buy and check the proximity of the area. If you have regular guests that come and go, you may need an extra room or two. If you have three children or more, you need a larger area to cope with your family’s needs.
Now, the total square footage of what you’re looking at listings may not say it all. Julie Ryan Evans, “How Big a Home Do You Truly Need? 5 Questions to Ask to Figure That Out,” Realtor.com stated that “Keep in mind that even small homes can feel spacious purely based on an open floor plan and lots of light. Meanwhile, large homes can still feel cramped if they’re dark or poorly laid out. So, when shopping real estate listings, know that the little number next to square footage may not tell the whole story.” She also added, “So instead of homing in on total square footage, “buyers should focus on the size of individual rooms where they see themselves spending the majority of their time,” says Ryan. In other words: Who cares if your bedroom isn’t massive, since all you plan to do there is sleep?”