10 Secrets You Should Know When Buying A Home
For many of us, buying a home is perhaps one of the largest purchases you will ever make in your lifetime. As such, we will have the tendency to err on the side of caution when it comes to purchasing a property to call home. Maybe you’ve found the perfect bintulu house for sale. Or maybe a wonderful apartment in the city has caught your eye. Whatever the type of property, the general gist of purchasing one remains the same.
Here are 10 secrets that you should know when you are buying a home.
#10: Keep your money where it is
Do not, I repeat, do not move your money around or make any huge purchases in the three- to six-month mark before buying a new home. Don’t take any chances with your credit profile. It is unwise and might ruin your chances of securing a good loan. So, think before you spend. Your potential lenders will want to see that you are reliable. You should have with you a detailed and complete paper trail of your finances so that you can get the best loan possible. For example, if you open new credit cards, amass a mountain of debt, or spend on big-ticket items, you’re going to have a hard time securing their trust, and a loan.
#9: Avoid a border dispute
It is essential for you to know the boundaries of your property. Get a survey done on the potential property so you know exactly what you are buying and to know precisely where your property lines are. Get an accurate map drawn up. This will save you from any potential dispute with your neighbors in the future. Furthermore, you will know exactly how much you have to pay in property tax, which is based on the size of your property.
#8: Don’t try to time the market
Don’t overanalyze or try to time the market. Although the real estate market is cyclical, where prices will go up and down and up back again, trying to anticipate the housing market is near impossible. Don’t obsess too much with figuring out the perfect time to buy. The best time to buy is not related to market conditions, nor is it dictated by any economic principles. Rather, the best time to buy is when you find the perfect property and you can afford it. If you hold out waiting for the perfect time when the price is right, the price will never be, and you will end up missing out on your dream home.
#7: Bigger isn’t always better
The biggest, most beautiful house on the block may not always be the best choice. Sure, it attracts the most attention and draws everyone’s interest. However, unless you are planning to stay there for eternity, buying the largest house might not be the smartest move. This is because the market and audience for the largest house is limited: it doesn’t appeal to many. This limits your pool of potential buyers in the future if and when you decide to re-sell. The value of your house will only go up in value as much as the other houses around you. If you end up paying much more for your house, your appreciation will be limited. Even buying the worst house per square footage on the black is a better option, because it will always trade for more than the bigger house.
#6: Avoid sleeper costs
Before you buy your home, know that there are sleeper costs involved. This is the biggest difference between renting and home ownership (other than the ownership itself, of course). Most people will only focus on the loan repayment. But you need to be aware of the other expenses that come with home ownership, i.e. property taxes, utilities, maintenance fees as well as homeowner-association dues. You will also need to be prepared to spend money on repairs, maintenance and potential tax increase, so make sure you budget for these hidden costs lest you risk losing your house.
#5: You’re buying a house, not dating it
For many first-time buyers, buying a house will involve a lot of emotions. Learn to keep your heart at the door and think with logic. If you fall in love with a house, your emotions might influence your financial sanity, causing you to make some potentially bad financial decisions. A property is an investment, so go with your instincts rather than emotions. Your instincts tell you that you’re getting a great house for a good value and good deal. Your emotions will make you obsessed with the size of the foyer, the paint color or even the front yard. Learn to differentiate between the two. Stay calm and be wise.
#4: Give your house a physical
Before you sign any contract or pay any money, hire a home inspector to check out you’re the house. You wouldn’t buy a car without checking under the hood. Likewise, you shouldn’t buy a home until you know the ins and outs of the property itself. A home inspector will provide you with an unbiased third-party opinion and information so that you can make an informed decision. What’s more, if there are any potential issues with the home, you can use it as leverage to bargain for a lower price.
#3: The secret science of bidding
Your bid on the purchase price should be based on two things: (1) what you can realistically afford and (2) what you really believe the house is worth. Don’t be afraid of offending the seller with your opening bid, as long as the number is fair and reasonable. You might want to go lower the first time you make a bid. A good tip is to look at what other comparables have sold for and get an average price per square foot. Then calculate it back for your house on a price-per-square-foot basis to truly equalize it all.
#2: Put in an offer price with an odd number
While putting in an offer with an oddball number might seem completely random, they are usually taken more seriously than a round number. A nice round number sounds like every normal bid out there. Giving an odd number makes it look like you have given your offer careful thought. Sellers will respect that and respond to it better.
#1: Stalk the neighborhood
Before you buy, go stalk around the neighborhood. Visit the area at different times of the day to get a feel of the environment. You don’t want to buy what you thought was your dream home, only to find out after moving that neighborhood doesn’t match your lifestyle. Drive by the house at different hours of the day to see if the neighborhood changes. Your first visit in the morning might be a breeze, but you might be shocked when the area turns into an inferno of traffic and noise by nightfall. Research the local amenities, including schools, to get a grip on how all this will affect the value of your home further down the road.