The Art of House Hunting
Once
you narrow the search to neighborhoods you like, you'll want to
determine the maximum house price you can afford. Even though you're
pre- approved for a set loan amount, it doesn't mean you can afford it.
You'll want to factor in other expenses, including retirement and
college savings, vacations, and home maintenance and repairs, when you
calculate how much you can afford for a monthly payment. And don't
forget to budget for homeowners insurance and property taxes. There's
also homeowner's assocation fees, especially in newer developments.
Next, differentiate your needs
versus your wants. You need three bedrooms, but a fourth room would be
nice for a play room or guest room. You need a two-car garage, but a
larger one would be nice for storage. You need a functional kitchen but
want hardwood floors. You need two bathrooms but want a luxurious master
suite. You get the picture.
As you begin your
house-hunting venture, prepare a checklist. Break it down between
exterior and interior characteristics. Make notes on each feature and
make notes. Some people give each a 1 to 10 score, which is fine, but
the first few houses you see will score differently than the last few
because you have many more to compare against. Also, after viewing many
homes, the numbers begin to lose meaning.
Some of the exterior features
to rate might include size of yard, quality of fence, paint condition,
roof condition, window conditions, garage, back yard. 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, the reputation of
local schools, etc.
Here are some other suggestions from industry experts:
- Take a camera with you to capture an image of each house you look at that makes it to the "maybe" list.
- 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.
- Review your checklist and notes and compare it against your needs, wants and budget.
- Bring your spouse, friend or family member with you to get a second opinion. They may notice a shortcoming that you've overlooked.
- Find out how much utilities and maintenance cost.
- 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.
- Be prepared to look at the potential of a house rather than what you see in front of you. Set your priorities and decide what can be sacrificed. It's more important that the layout of the house and the number of bedrooms you need fit your needs and that all major systems are functional versus your dislike for the avocado green carpet or the lack of landscaping. Those types of cosmetic shortcomings can be easily remedied once you buy the house.
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.
And don't forget—once you make
an offer, make it contingent upon the findings of a professional home
inspection. If any major defects surface, you'll want to have the
leverage to renegotiate or back out of the deal completely.
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Eight tips to help in your search
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