Home Sweet Home: 7 Factors to Weigh Before Buying a Home
Buying a home is no small decision and there is a lot to consider before signing those mortgage papers. To ensure you are making the right choice, it’s important to not only know where you want to buy and what type of home best suits your needs, but to also educate yourself about the responsibilities of buying a home as well as the obligations of home ownership.
Importance of Housing Decisions
Deciding where you will live and exactly which home you will buy is an important choice that will affect you for many years to come. To be confident in your choice and feel good about the home you are thinking of buying, you should do your homework to make sure you are buying a home that is affordable based on your finances. It’s also important to secure financing with fair terms with a trusted lender.
Here are seven steps to help you make the best decisions when it comes to buying a home and realizing your dream of home ownership.
7 Factors to Consider Before Buying a Home
1. Financial Preparedness
Are you able to afford a home purchase? Being prepared for home ownership includes the ability to be approved for a mortgage. This includes factors such as a down payment, money for closing costs, the ability to afford the mortgage payments, and a good credit history to secure the financing.
2. Location, Location, Location
Besides securing financing, the location of your new home may be the most important part of the home buying process. Assuming you have already decided the city and state in which you want to live, choosing an area or community is crucial. It may be helpful to make a list of your top five priorities that include things like work commute, schools, entertainment options, location of friends and family, etc. Once you know what you need in a home location, you can better find the neighborhoods that best fit your situation.
3. Home Size and Layout
Choosing the right size and layout of your home is important to ensure you have the right amount of space for now and in the future. It also ensures that the layout works well with your lifestyle and accommodates everyone who lives in the home. Think about future plans when choosing the size and floor plan of your home to ensure it will work throughout the years to come if your family grows, or you desire certain living spaces for your daily activities.
4. Condition and Inspection
What type of home are you looking for? A turn-key home with little to no upgrades or a fixer-upper that needs work to make it your own? Both are popular choices for homebuyers and either way they should have a professional inspection performed to determine the condition of the home before you commit to buying it, so you know exactly what to expect.
5. Homeowners Association (HOA) and Covenants
Buying a home in a community that has an HOA and covenants takes some research and consideration, as there are pros and cons associated with the management of your community. The good thing is that you are most likely assured that your community appearance and upkeep will be held to a certain standard. The downside is that these rules may interfere with your ideas for your home. In addition, make it a point to clearly understand the fees associated with the HOA and everything that is your responsibility.
6. Resale Value and Market Trends
One of the most important things to consider when buying a house is the local real estate market and how it will affect your resale value. The current state of the market in your area is a huge factor when considering home ownership. Are there available homes in your market at the right price and location? Is it more affordable to own than rent in your area? What are the current interest rates, and how are they trending? Is the area popular enough to see home prices increase over the years? All important questions to consider.
7. Emotional Factors and Future Plans
Do not underestimate your emotional state when buying a home. You may find it overwhelming to be facing such a huge commitment…and that’s ok. Analyze your current lifestyle as well as your future plans when considering home ownership. Things change when you own a home vs renting, and you need to be sure that the additional responsibilities that come along with home ownership fit your present and future goals.
Understanding these seven factors to consider before buying a home is a savvy move by potential homebuyers. Educating yourself is a great way to ensure you are prepared and better understand the best time for you to consider home ownership.
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