There are many different reasons why people want to buy their dream home. Buying a home will likely be the largest purchase of your life which is why you are best served to weigh all of your options before making a final decision.
If you are single, then you can sit down and make your own list of why it’s time to move into the housing market.
If you are a couple, the two of you should be able to reach an agreement on this issue before starting to look. Honestly, home ownership is not for everyone, so make sure first that this is really what you want!
The advantage of buying is that each mortgage payment is an investment in your property, while rent goes towards your landlord’s equity, not yours. However, that landlord also has to worry about repairs and upgrades while homeowners have to pay for those expenses themselves.
You might not want the financial uncertainty that comes with buying a home. In addition, you may not want to tie yourself down too much if for instance you love to travel and spend money on other things.
Once you have decided that it’s time to take the plunge into home ownership, it’s important to know what you can afford. The Mortgage pre-approval process makes a lot of sense so you know ahead of time what houses are worth looking at and which ones you can take a pass on, both at the bottom and the high end of the price range in your area.
It’s important to consider where your ideal home would be. Do you want to live in an urban setting, close to amenities like entertainment venues, restaurants, and your workplace? Are you looking for a suburban setting where you can enjoy your backyard but still be within easy reach of stores and mass transportation? Or are you eager to get out of town and find a rural property with peace and quiet and more space?
While you may eventually end up compromising on location if the perfect home turns up in an unexpected place, it’s good to go into the process with an idea of what you want.
Any real estate market has both existing homes for resale as well as new homes in subdivisions. You may also choose to buy a vacant lot and build an individual home. You will want to decide which option is better for you, resale or new build?
Buying an existing home, whether it is 5, 50, or 100 years old, provides you with a pretty good understanding about what the neighborhood is like. You won’t have to wait for a year or more for schools to be opened in the area, or for public transportation to be established. You also will have a head start on landscaping, with large shade trees and green lawns already in place.
On the other hand, you will probably want to make changes to the interior or exterior, which will add to the cost of the house overall, and can either delay your moving-in, or create some chaos as you live with renovations.
Buying a home in a new development means that you will be able to make some choices about your new home from the ground up. Everything from brilliant kitchen lighting to paint colors to flooring can be tailored to your personal preferences.
However, you will be moving into a brand-new neighborhood that will not yet be completed. And there may well be limitations on how much you can individualize the exterior of your home.
Buying a lot in either an established neighborhood, or out in the country, lets you choose a contractor on your own and create a home that is exactly what you want. However, you need to choose a contractor carefully so that you can trust the quality of their work and adherence to the schedule. You may also run into cost overruns that may strain your finances.
Traditionally, most homeowners have started with a small home that they can afford. Then, as their available resources and family grow, they sell that first place and move up into a larger place in a more desirable location.
However, as millennials are entering the housing market later than previous generations, they are more likely to be able to afford a forever home that they can envision staying in indefinitely. You may choose to sacrifice some financial flexibility in the short term in favor of investing in a property that meets your desires for the future.
Buying a house is the single biggest investment that most people will ever make. Before entering the housing market, go in knowing what you can afford, where you want to live, and what sort of house you want. It will make the whole process much easier!
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About the Author
The article was written by Eric Jeanette who has been a real estate professional since 1993. Today, Eric operates a lender match service for consumers at Dream Home Financing and FHA Lender.com.