Winter vs Summer
With your down payment in hand and your pre-approval letter for a mortgage loan, the next step is finding the house that will best meet your family’s needs. With realistic expectations, patience and plenty of research, you’ll be well on your way.
Once you narrow the search to neighborhoods you like, you’ll want to determine the maximum house price you can afford. This alone may reduce the number of neighborhoods you can choose from. Even though you’re pre-approved for a set loan amount, doesn’t mean you can afford it. You’ll want to factor in other expenses you currently have even before you start house hunting. Some examples of these expenses includes retirement, college savings, vacations, and home maintenance and repairs when you calculate how much you can afford for a monthly payment. Don’t forget to budget for homeowners insurance and property taxes. There may be homeowner’s association fees to factor in determining where you choose to call home.
Now that you are determining what you can spend on a house, separate your wants from your needs. If you are looking for a home in New Jersey, do you have to have a home 2 blocks from the beach? This is an example of a question you must ask yourself. You get the point, be honest with yourself. Do you need three bedrooms? A fourth room would be nice for a play room or guest room but is it necessary? You need a two-car garage, but a larger one would be nice for storage. Do I really need it? You need two bathrooms but do you want a luxurious master suite? Simply put, you have a set amount of money to divide it the way you want to. A bigger master bedroom may mean smaller bedrooms than anticipated. A double car garage will mean less basement to finish in the future (or now).
Your “wish list” narrows down the homes that you will consider. Be honest with yourself about getting everything you want. You may not get all 10 things you were looking for but instead may have to settle for seven of the ten. There is no formula for this. It’s strictly a personal preference as well as a personal decision.
Some of the exterior features to be mindful of might include the size of the yard, quality of fence, paint condition, roof condition, window conditions, garage, and backyard. Factor in the state you are looking in. When it comes to interior, think about square footage; the floor plan; condition of walls; the size, quality, and functionality of the various rooms and closet and storage space.
Your checklist should also include any other factors you deem important—the amount of traffic, the appearance of the neighborhood, safety in the area, and the reputation of local schools, etc.
Decision making guide
Below is a list that real estate agents have comprised to guide in a house hunting excursion:
- Don’t make a hasty decision, especially if you feel yourself becoming guided by emotion. Selecting a home takes time, thought and analysis. You should carefully weigh the pros and cons of each house you like. Rather than take the word of your real estate agent, have a property appraisal done by a certified property appraiser like Abbe Edleman.
- Find out how much utilities cost in the area selected.
- Stay on top of newly listed houses via a Multiple Listing Service on the Internet.
- Remain in close contact with your agent. This is extremely important if you’re in a strong seller’s market and/or in which homes that are priced right go fast. You want a good agent who will alert you of new listings and who will show you the houses as soon as they’re listed.
If you find a house you like, offer a competitive bid. Keep in mind you’ll likely be competing against other offers—especially if interest rates are low and the spring buying season is in full bloom. Once you make an offer, make it contingent upon the findings of a professional home inspection. If any major defects surface, you’ll have the leverage to renegotiate or back out of the deal completely. Happy hunting!
