Probably the most expensive purchase most of us will make in our lives is that of our new homes. Because it’s such an important investment, it’s not one you want to make lightly.
Aside from the location of the house and what it looks like, there are quite a few factors you should consider before buying a home. Going into the experience of new-house hunting with your eyes open can help you find your dream home instead of a nightmare.
Make sure you know the answers to these five essential questions before you sign on the dotted line!
1. What Will Your Monthly Payment Be?
Lenders are quick to tell you how much you qualify for and what their portion of the monthly mortgage is. But there’s a lot more included in the final costs.
The breakdown of what you can expect to pay is based in part on your interest rate. Will yours be fixed or variable? Are there fees you’ll incur if you pay it off early? What are the different mortgage payments for a lesser or longer term?
You might find yourself able to save thousands in interest charges by tacking on a few extra dollars a month.
Don’t forget to include the homeowner’s insurance, property taxes, and private mortgage insurance when you calculate your monthly payment. Your neighborhood might have homeowner’s association (HOA) fees, too.
2. Is the Location Consistently Stable?
Many families buy a home based on the school zone and distance from amenities, only to find the entire neighborhood overhauled within a few years. You can’t always control this, but if you do your research ahead of time, you might be able to catch issues before they happen.
Check the crime rate in the area over the past five years. Is there a trend? Ask your realtor if there have been any major permits pulled for new buildings that could affect property values.
If you’re not from the area you’re looking to buy in, spend some time there first and ask questions from the locals. You might change your mind about the location you chose!
3. Will Your Home Be Worth What You Paid?
Everyone wants the best deal: the seller, the buyer, and the realtors on both sides! With conflicting interests, it can be hard to judge who is getting the best end of the bargain.
What you need to look into is whether your home will appraise for what you paid for it and then whether it’s likely to appreciate or depreciate after you buy it.
Many people are choosing manufactured homes over condos and expensive houses in today’s market. These affordable homes are often spacious and attractive, and you can buy new instead of dealing with a seller trying to cover their own payoff costs.
4. How Old is the Home, Inside and Out?
Don’t turn up your nose automatically at an older home in favor of a newer model. First, check and see how old the important features are. You might find it’s worth investing in a home a little bit older for the cheaper price.
New roofs are likely still under warranty, so you may be better off with a home that has a recently renovated top. Wiring is another factor to check into. Old wiring can cause electrical fires.
Other selling points for older homes include those that have been recently reinsulated, have new air conditioning units, and/or renovated pipes and septic systems.
5. Will You Be Able to Grow Into It?
Picture yourself in the next ten to twenty years, or longer if you plan on staying in your home for the rest of your life. Will the house fit your future? Will you outgrow it? Or will it outgrow you?
Whether you’re just starting out and building a family or you envision being an empty nester, the one constant will be your house. It may seem perfect for your
I’m a 20-something stay-at-home mother and wife. I have an amazing husband, a beautiful daughter, two loving dogs, and a lazy cat. I wouldn’t change my life for anything! I love to read, listen to music, cook and blog!
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