As you attend open houses, carefully assess whether a home ticks all your boxes. Here are some things to consider when buying a house as a first-time home buyer or a seasoned pro:
1. Price
For many prospective home buyers, a home’s purchase price is their biggest concern. If they overspend on a house, they run the risk of becoming house poor, spending most of their income on housing, including monthly mortgage payments. When you’re “house poor,” it limits your ability to spend on other essential needs or save money.
Consider getting a mortgage preapproval from your mortgage lender before you begin house shopping. The preapproval will tell you how much home you can afford and what down payment you’ll need to make. When you know these figures ahead of time, you can avoid wasting time viewing homes that are more expensive than you can afford.
Where you buy a home will have a tremendous impact on your day-to-day life. Location is another critical factor to consider while you search for the right home. When considering a potential home, it’s important to evaluate several components of location, including:
Flood zone: Before buying a house in a flood zone, research the area’s assigned flood zone code and assess your comfort level if the home is in a flood-prone area. And while it will likely increase your monthly expenses, you may benefit from purchasing flood insurance.
Safety:Research the neighborhood. You can start by looking at local crime data and joining neighborhood social media groups to gain more insight into the community.
School district: Whether you have children in the home or not, research the local school district. Buying a house in a community with a competitive school district can be very helpful when you sell a home.
Distance from the airport: Whether you travel repeatedly or rarely, learn how to get to your local airports from your new home. Consider the expense of ride-hailing apps and calculate how long a round trip to the airport may be.
Public transportation: Consider your public transportation options. If you don’t drive, choosing a home close to a reliable method of public transportation, like a bus stop or subway station, may be essential.
3. House Size
Carefully consider the size and floor plan of every home you tour and whether they measure up to your needs. Some aspects of a home’s size to look at include:
Square footage
Overall layout
Number of bedrooms
Number of bathrooms
Living room size
Whether there’s a garage, basem*nt or attic
Yard space
Determine which aspects are essential. Then try finding a home that meets your top requirements. A home is a major investment – do your research to establish whether it meets your basic needs.
Another factor that impacts a home’s overall affordability is property taxes. Compare property tax amounts over several years to help you calculate the overall affordability of a home.
5. Homeowners Association (HOA)
Decide early on whether you want to live in a community tied to a homeowners association (HOA) or prefer to have greater control over what you can do with your home.
Some homes are part of a local HOA, an organization that manages a residential community. When you live in a community run by an HOA, you likely pay a fee to help maintain common areas and community amenities, and the HOA may limit what you can and can’t do with your home.
You pay HOA fees in addition to your monthly mortgage payment. You should know the amount and confirm that it fits comfortably into your budget to avoid making an offer on a home attached to an HOA with an unaffordable fee.
6. Amenities
Finally, consider any community amenities you’d like access to. For example, if a home you want to buy doesn’t have a pool, you may prioritize living in a neighborhood with a public pool. If you have children, a large playground may be a priority. If lawn care isn’t your thing, buying a home in a community with a homeowners association that provides lawn maintenance may make sense.
Ultimately, amenities are nice-to-haves, not must-haves. But they can be the proverbial cherry on top that makes living in a neighborhood even more enjoyable.
Consider your down payment amount and what you can afford in monthly mortgage payments coupled with recurring debts and household expenses (like daycare, groceries, utilities, tuition, etc.). You'll also want to have savings set aside for home maintenance and major repairs.
Assess your financial readiness and credit score before buying a house. Determine your budget and calculate how much you can afford to spend on a house. Research and explore different financing options, such as conventional, FHA, VA, and USDA loans.
While personal preferences and priorities may vary, three key elements consistently stand out as the most crucial when purchasing a home: location, budget, and property condition. These factors influence your immediate living situation and impact your overall satisfaction and investment value.
Here are some qualities to keep an eye out for: misaligned doors, cracks in the walls, sloping in the floor, and the windows are hard to open or has cracked glass. If you notice a lot of these qualities during a house tour, have an inspector take a look at the foundation before committing to the home.
Updating a bathroom is another smart investment, says Katie Severance, a Realtor with Douglas Elliman in Palm Beach, Florida, and author of “The Brilliant Home Buyer.” “Renovated kitchens and baths are the 'money rooms' — those that add the most value to a home,” she says.
Several factors could keep you from getting a mortgage, including a low credit score or income, high debts, a spotty employment history and an insufficient down payment. Experian, TransUnion and Equifax now offer all U.S. consumers free weekly credit reports through AnnualCreditReport.com.
Step one, as noted at the top of our list, is to check your credit score. Before you get into finding a lender, real estate agent or even looking at homes, you should take a look at where your creditworthiness stands. Good and excellent credit can qualify you for the best loans and interest rates.
If you're wondering what percentage you should put down on a house, 20% down is the rule of thumb, but there is no one-size-fits-all figure. For example, some loan programs require a down payment as little as 3% or 5%, and some don't require a down payment at all.
A good credit score to buy a house is one that helps you secure the best mortgage rate and loan terms for the mortgage you're applying for. You'll typically need a credit score of 620 to finance a home purchase. However, some lenders may offer mortgage loans to borrowers with scores as low as 500.
Introduction: My name is Van Hayes, I am a thankful, friendly, smiling, calm, powerful, fine, enthusiastic person who loves writing and wants to share my knowledge and understanding with you.
We notice you're using an ad blocker
Without advertising income, we can't keep making this site awesome for you.
